Here is the full transcript of Adam Carroll’s TEDx presentation on When Money Isn’t Real: The $10,000 Experiment at TEDxLondonBusinessSchool conference.
Listen to the MP3 Audio: When money isn’t real- the $10,000 experiment by Adam Carroll at TEDxLondonBusinessSchool
I recently completed an unsanctioned, unsupervised psychological experiment on my children. The premise of which was $10,000 in cash on the kitchen table and a sign next to it that said, “Don’t touch the money yet!”
And before I dive into it, you should know that we are a game playing family. We play ball games, board games, dice games, card games; we play all sorts of games. But the games that my children love to play most are games like Monopoly. And when they play Monopoly, they play marathon games of Monopoly that last hours and hours over days of play.
Each of my kids has a unique strategy and personality when they play Monopoly. My daughter who is 11, she is always the dog. She plays entirely for chance and community chest cards. You could say that she uses the luck strategy. My 9-year-old son is always the car, a very strategic player. He buys all of the railroads and all of the utilities and then proceeds to put houses and hotels on the most expensive properties; very savvy. And then his younger brother who is seven, he buys everything that he lands on with no exception, which is fitting because he is the wheelbarrow.
Now before I tell you how my experiment unfolded, first, I have to share an observation that led me to the creation of it. One Monopoly Marathon, Saturday morning I was playing with my kids and noticed that they were all playing just outside of the rules of the game. So they were doing things like buying each other out of jail and lending each other money to buy properties. And I found myself going, “guys, this is not how this game is played”, to which they would say, “Dad, it’s fine. We just want her on the board with us”, or “he can pay me back at the end of the game when he’s flushed with cash”. And I’m thinking, again, “What am I teaching these kids?”
So I started watching how they were playing, listening to their banter, getting a feel for how they were making decisions. And I had this thought: what if they’re playing this way because the money isn’t real. And it’s this concept, I’ve been reading a lot about lately it’s called financial abstraction, the notion that when money becomes more and more of an idea, less tangible and therefore more abstract, it changes the way that we interact with it on a regular basis. And there’s anecdotal evidence of abstraction everywhere around us. All you have to do is listen carefully to people who say, “I loaned my child or grandchild the phone and a month later I had all these errant in-app charges showing up on my bill.
In 2014, Apple reimbursed customers for in-app purchases that were unapproved, mostly by children to the tune of $32.5 million. This is in a US Federal Trade Commission settlement. In the documentation it said, “It was just too easy for kids to make an in-app purchase.” The Imagineers at Disney were charged with making the parks frictionless, it’s what they called it. So they invested $1 billion in a magic band, a wearable device that functions as your room key, your park ticket and your ID and wallet when you’re on park property. So if your child wants a set of ears and they want a desert in a magic kingdom, Bibbidi-Bobbidi-Boo, your vacation just costs a whole lot more, magically, magically.
Last but not least, I had a conversation with some teenagers who told me that $100,000 a year really wasn’t that much money. And I said, “Really? Why do you think that?” They each said, “Well, we both have $500,000 in our ATM machines on Grand Theft Auto, which is a very popular and somewhat skeptical sketchy video game popular today.
So as I’m playing with my kids and I’m watching them play, I’m listening to them talk about this, I thought: what if the money were real on the table, would they play differently? And so I calculated real quickly on the box: how much would it take in capital and currency to play a physical game of Monopoly with my kids that they actually tangibly got to feel the money in their hands? And I estimated for four or five players, that’s about $10,000 US dollars.
So one Friday I stopped at the bank, I got all the denominations of bills you would get on the Monopoly board, with the exception of a $500 bill, hard to get. And one Sunday, I rounded the family up for a high-stakes game of Monopoly where the winner takes all — all of $20 — by the way, all of $20. You have never seen kids’ eyes light up the way mine did when I handed each of them $1500 in starter capital. And you have never seen anyone’s eyes light up like my wife’s when I took it back on Monday, all of it.
So our Marathon game only lasted two and a half hours, far shorter and more strategic than most of the games that are normally played. True to my hypothesis, two of my three kids actually played differently. My daughter still played the luck card. She was the first one bankrupted, and she happily retired to the living room to read a book.