The half-bearded behavioral economist Dan Ariely tends to preface discussions of his work—which has inquired into the mechanisms of pain, manipulation, and lies—with a reminder that he comes by both his eccentric facial hair and his academic interests honestly. He tells a version of the story in the introduction to his breezy first book, “Predictably Irrational,” a patchwork of marketing advice and cerebral self-help. One afternoon in Israel, Ariely—an “18-year-old military trainee,” according to the Times—was nearly incinerated. “An explosion of a large magnesium flare, the kind used to illuminate battlefields at night, left 70 percent of my body covered with third-degree burns,” he writes. He spent three years in the hospital, a period that estranged him from the routine practices of everyday life. The nurses, for example, stripped his bandages all at once, as per the cliché. Ariely suspected that he might prefer a gradual removal, even if the result was a greater sum of agony. In an early psychological experiment he later conducted, he submitted this instinct to empirical review. He subsequently found that certain manipulations of an unpleasant experience might make it seem milder in hindsight. In onstage patter, he referred to a famous study in which researchers gave colonoscopy patients either a painful half-hour procedure or a painful half-hour procedure that concluded with a few additional minutes of lesser misery. The patients preferred the latter, and this provided a reliable punch line for Ariely, who liked to say that the secret was to “leave the probe in.” This was not, strictly speaking, optimal—why should we prefer the scenario with bonus pain? But all around Ariely people seemed trapped by a narrow understanding of human behavior. “If the nurses, with all their experience, misunderstood what constituted reality for the patients they cared so much about, perhaps other people similarly misunderstand the consequences of their behaviors,” he writes. “Predictably Irrational,” which was published in 2008, was an instant airport-book classic, and augured an extraordinarily successful career for Ariely as an enigmatic swami of the but-actually circuit.
Ariely was born in New York City in 1967 and grew up north of Tel Aviv; his father ran an import-export business. He studied psychology at Tel Aviv University, then returned to the United States for doctoral degrees in cognitive psychology at the University of North Carolina and in business administration at Duke. He liked to say that Daniel Kahneman, the Nobel Prize-winning Israeli American psychologist, had pointed him in this direction. In the previous twenty years, Kahneman and his partner, Amos Tversky, had pioneered the field of “judgment and decision-making,” which revealed the rational-actor model of neoclassical economics to be a convenient fiction. (The colonoscopy study that Ariely loved, for example, was Kahneman’s.) Ariely, a wily character with a vivid origin story, presented himself as the natural heir to this new science of human folly. In 1998, with his pick of choice appointments, he accepted a position at M.I.T. Despite having little training in economics, he seemed poised to help renovate the profession. “In Dan’s early days, he was the most celebrated young intellectual academic,” a senior figure in the discipline told me. “I wouldn’t say he was known for being super careful, but he had a reputation as a serious scientist, and was considered the future of the field.”
The new discipline might have lent itself to a tragic view of life. Our preferences were arbitrary and incoherent; no narrator was reliable. What differentiated Ariely was his faith that we could be managed. “It is very sad that we are fallible, myopic, vindictive, and emotional,” he told me by e-mail. “But in my view this perspective also means, and this is the optimistic side, that we can do much better.” Take, for example, cheating. If people are utility-maximizing agents, they will fleece as much as they can get away with. Ariely believed, to the contrary, that a potential cheater has to balance two conflicting desires: the urge to max out his gains and the need to see himself as a good person. In experiments, Ariely found that most people cheat when given the opportunity—but just a little. Ariely, who does not shy from cutesiness, called this the “fudge factor.” In turn, he proposed, people might just need to be reminded that they aspire to be decent. In one of his most famous experiments, he asked students to score their own math tests. Half the students had first been asked to list the Ten Commandments. Although most could recall only a few, Ariely found that, in this group, “nobody cheated.” The insight was simple, the intervention subtle, and the consequences enormous.
Ariely came to owe his reputation to his work on dishonesty. He offered commentary in documentaries on Elizabeth Holmes and pontificated about Enron. As Remy Levin, an economics professor at the University of Connecticut, told me, “People often go into this field to study their own inner demons. If you feel bad about time management, you study time inconsistency and procrastination. If you’ve had issues with fear or trauma, you study risk-taking.” Pain was an obvious place for Ariely to start. But his burn scars heightened his sensitivity to truthfulness. Shane Frederick, a professor at Yale’s business school, told me, “One of the first things Dan said to me when we met was ‘Would you ever date someone who looked like me?’ And I said, ‘No fucking way,’ which was a really offensive thing to say to someone—but it weirdly seemed to charm Dan.” From that moment, Frederick felt, Ariely was staunchly supportive of his career. At the same time, Ariely seemed to struggle with procedural norms, especially when they seemed pointless. Once, during a large conference, John Lynch, one of Ariely’s mentors, was rushed to the hospital. Ariely told me that only family members were allowed to visit. He pretended that his scarring was an allergic reaction and, once he was admitted, spent the night by Lynch’s side. In his telling, the nurse was in on the charade. “We were just going through the motions so that she could let me in,” he told me. But a business-school professor saw it differently. “Dan was seen as a hero because he had this creative solution,” she said. “But the hospital staff, even though they knew this wasn’t a real allergic reaction, weren’t allowed to not admit him. He was just wasting their time because he felt like he shouldn’t have to follow their rules.”
A decade or so into his career, Ariely’s focus shifted to applied research. A former affiliate told me that Ariely once said, “Some behavioral economist is going to win the Nobel Prize—what do I have to do to be in contention?” (Ariely denies wondering whether he would get the Nobel Prize.) In the spring of 2007, he asked an insurance company if he could replace its ordinary automobile-policy review form with experimental versions of his own. Customers had an incentive to underreport their annual mileage, in order to pay lower premiums. Half the participants were to receive a form that asked them to sign an honesty declaration at the end. The other half were to receive an alternate version, which instructed them to sign a pledge at the beginning. The following year, on his first book tour, Ariely addressed a crowd at Google, where he was later contracted to advise on a behavioral-science project, and referred in passing to the experiment’s results. Those who signed at the beginning, he said, had been more candid than those who signed at the end. “This was all about decreasing the fudge factor,” he said. In 2009, Ariely noted in the Harvard Business Review that the insurance company had updated its own forms to exploit his finding. He hadn’t yet published the study, which, given its obvious importance, might have seemed peculiar. But, at the time, nothing appeared to indicate that the results weren’t trustworthy. “People who go through a tragedy like Dan, with his burn—they have an insight into what’s important in life,” the filmmaker Yael Melamede, who collaborated with Ariely on a documentary about dishonesty, told me. “He was very aware of the dangerous desire to make experiments go your way, to bend reality to your benefit.”
Despite a good deal of readily available evidence to the contrary, neoclassical economics took it for granted that humans were rational. Kahneman and Tversky found flaws in this assumption, and built a compendium of our cognitive biases. We rely disproportionately on information that is easily retrieved: a recent news article about a shark attack seems much more relevant than statistics about how rarely such attacks actually occur. Our desires are in flux—we might prefer pizza to hamburgers, and hamburgers to nachos, but nachos to pizza. We are easily led astray by irrelevant details. In one experiment, Kahneman and Tversky described a young woman who had studied philosophy and participated in anti-nuclear demonstrations, then asked a group of participants which inference was more probable: either “Linda is a bank teller” or “Linda is a bank teller and is active in the feminist movement.” More than eighty per cent chose the latter, even though it is a subset of the former. We weren’t Homo economicus; we were giddy and impatient, our thoughts hasty, our actions improvised. Economics tottered.
Behavioral economics emerged for public consumption a generation later, around the time of Ariely’s first book. Where Kahneman and Tversky held that we unconsciously trick ourselves into doing the wrong thing, behavioral economists argued that we might, by the same token, be tricked into doing the right thing. In 2008, Richard Thaler and Cass Sunstein published “Nudge,” which argued for what they called “libertarian paternalism”—the idea that small, benign alterations of our environment might lead to better outcomes. When employees were automatically enrolled in 401(k) programs, twice as many saved for retirement. This simple bureaucratic rearrangement improved a great many lives.
Thaler and Sunstein hoped that libertarian paternalism might offer “a real Third Way—one that can break through some of the least tractable debates in contemporary democracies.” Barack Obama, who hovered above base partisanship, found much to admire in the promise of technocratic tinkering. He restricted his outfit choices mostly to gray or navy suits, based on research into “ego depletion,” or the concept that one might exhaust a given day’s reservoir of decision-making energy. When, in the wake of the 2008 financial crisis, Obama was told that money “framed” as income was more likely to be spent than money framed as wealth, he enacted monthly tax deductions instead of sending out lump-sum stimulus checks. He eventually created a behavioral-sciences team in the White House. (Ariely had once found that our decisions in a restaurant are influenced by whoever orders first; it’s possible that Obama was driven by the fact that David Cameron, in the U.K., was already leaning on a “nudge unit.”)
The nudge, at its best, was modest—even a minor potential benefit at no cost pencilled out. In the Obama years, a pop-up on computers at the Department of Agriculture reminded employees that single-sided printing was a waste, and that advice reduced paper use by six per cent. But as these ideas began to intermingle with those in the adjacent field of social psychology, the reasonable notion that some small changes could have large effects at scale gave way to a vision of individual human beings as almost boundlessly pliable. Even Kahneman was convinced. He told me, “People invented things that shouldn’t have worked, and they were working, and I was enormously impressed by it.” Some of these interventions could be implemented from above. Brian Wansink, a researcher at Cornell, reported that an attractive wire rack and a lamp increased fruit sales at a school by fifty-four per cent, and that buffet diners likely consumed fewer calories when “cheesy eggs” weren’t immediately at hand. Other techniques were akin to personal mind cures. In 2010, the Harvard Business School professor Amy Cuddy purported to show that subjects who held an assertive “power pose” could measurably improve their confidence and “instantly become more powerful.” In advance of job interviews, prospective employees retreated to corporate bathrooms to extend their arms in victorious V’s.
In 2017, Thaler won the Nobel Prize for his analysis of “economic decision-making with the aid of insights from psychology.” Some policy nudges did not ultimately survive empirical scrutiny (though early studies showed that making organ donation opt-out rather than opt-in would cause the practice to become more widespread, long-term evaluations suggested that it had little effect), but the bulk of them held up. By that point, however, a maximalist version of the principle—easily absorbed by viral life-hack culture—had become commonplace. Ariely, for his part, predicted that nudges were just the beginning, and held out for more ambitious social engineering. He told me, “I thought that in many cases paternalism is going to be necessary.” At the end of “Predictably Irrational,” he writes, “If I were to distill one main lesson from the research described in this book, it is that we are pawns in a game whose forces we largely fail to comprehend.”
Haaretz once called Ariely “the busiest Israeli in the world.” I met him several times in the past year, although he agreed to speak on the record mostly in writing. A stimulating and slightly unnerving interlocutor, he has coarse black bangs, tented eyebrows, and the frank but hooded aspect of an off-duty mentalist or a veteran card-counter. “Predictably Irrational” considerably expanded his sphere of influence. He started a lab at Duke called the Center for Advanced Hindsight, which was funded by BlackRock and MetLife. He had a wife and two young children in Durham, but spent only a handful of days a month in town. In a given week, he might fly from São Paulo to Berlin to Tel Aviv. At talks, he wore rumpled polos and looked as though he’d trimmed his hair with a nail clipper in an airport-lounge rest room. He has said that he worked with multiple governments and Apple. He had ideas for how to negotiate with the Palestinians. When an interviewer asked him to list the famous names in his phone contacts, he affected humility: “Jeff Bezos, the C.E.O. of Amazon—is that good?” He went on: the C.E.O.s of Procter & Gamble and American Express, the founder of Wikipedia. In 2012, he said, he got an e-mail from Prince Andrew, who invited him to the palace for tea. Ariely’s assistant had to send him a jacket and tie via FedEx. He couldn’t bring himself, as an Israeli, to say “Your Royal Highness,” so he addressed the Prince by saying “Hey.”
Ariely seemed to know everything and everyone. “What an amazing life to lead,” a former doctoral student in his lab said. “It was like ‘The Grand Budapest Hotel.’ ” He told people that he’d climbed Annapurna and rafted down the Mekong River. But he was also attentive. “Every single time I went into the room and interacted with Dan, it was unbelievably enjoyable,” the student said. At one talk, he auctioned off a hundred-dollar bill, with the stipulation that the second-highest bidder would also have to pay. The winner owed a hundred and fifty dollars; the loser owed a hundred and forty-five dollars for nothing. Both might have felt like idiots, but Ariely wasn’t scornful; he sympathized. His knowledge of human behavior could be burdensome. “It makes daily interactions a little difficult,” he said. “I know all kinds of methods to convince people to do things I want them to do.” He told me, “Just imagine that you could separate the people who are your real friends from the people who want something from you. . . . And now ask yourself if you really want to know this about them.”
One of his frequent collaborators was Francesca Gino, a rising star in the field. Gino is in her mid-forties, with dark curly hair and a frazzled aspect. She grew up in Italy, where she pursued a doctorate in economics and management. Members of her cohort remember her dedication, industry, and commitment. She first came to Harvard Business School as a visiting fellow, and, once she completed her Ph.D., in 2004, she stayed on as a postdoc. She later said that she went to Harvard for a nine-month stint and never left. This story elides a few detours. By the end of her postdoc, in 2006, she had yet to publish an academic paper, and Harvard did not extend an offer. One of her mentors at Harvard, a professor named Max Bazerman, helped make introductions; she eventually landed a postdoc at Carnegie Mellon. A senior colleague who knew her at the time told me, “That entire experience could plausibly have left her with a keen sense of the fragility and precariousness of academic careers.” At last, she seemed to find her footing, and it soon looked as though she could get almost any study to produce results. She secured a job at U.N.C., where she entered a phase of elevated productivity. According to her C.V., she published seven journal papers in 2009; in 2011, an astonishing eleven.
Ariely and Gino frequently collaborated on dishonesty. In the paper “The Dark Side of Creativity,” they showed that “original thinkers,” who can dream up convincing justifications, tend to lie more easily. For “The Counterfeit Self,” she and Ariely had a group of women wear what they were told were fake Chloé sunglasses—the designer accessories, in an amusing control, were actually real—and then take a test. They found that participants who believed they were wearing counterfeit sunglasses cheated more than twice as much as the control group. In “Sidetracked,” Gino’s first pop-science book, she seems to note that such people were not necessarily corrupt: “Being human makes all of us vulnerable to subtle influences.” In 2010, she returned to Harvard Business School, where she was awarded an endowed professorship and later became the editor of a leading journal. She dispensed page-a-day-calendar advice on LinkedIn: “Life is an unpredictable journey. . . . The challenge isn’t just setting our path, but staying on it amidst chaos.” She was a research consultant for Disney, and a speakers bureau quoted clients between fifty and a hundred thousand dollars to book her for gigs. In 2020, she was the fifth-highest-paid employee at Harvard, earning about a million dollars that year—slightly less than the university’s president.
Gino drew admiring notice from those who could not believe her productivity. The business-school professor said, “She’s not just brilliant and successful and wealthy—she has been a kind, fun person to know. She was well liked even by researchers who were skeptical of her work.” But she drew less admiring notice, too—also from people who could not believe her productivity. As one management scholar told me, “You just cannot trust someone who is publishing ten papers a year in top journals.” Other co-authors, as collateral beneficiaries, weren’t sure what to think. One former graduate student thought that she caught Gino plagiarizing portions of a literature review, but tried to convince herself that it was an honest error. Later, in a study for a different paper, “Gino was, like, ‘I had an idea for an additional experiment that would tie everything together, and I already collected the data and wrote it up—here are the results.’ ” The former graduate student added, “My adviser was, like, ‘Did you design the study together? No. Did you know it was going to happen? No. Has she sent you the data? No. Something off is happening here.’ ” (Gino declined to address these allegations on the record.)
Cartoon by Liana Finck
In late 2010, Gino was helping to coördinate a symposium for an Academy of Management conference, on “behavioral ethics,” which listed Ariely as a contributor. At the time, Gino and Bazerman were researching moral identity. Ariely’s findings with the car-insurance company remained unpublished, but his talks had made the rounds, and his field study seemed like the perfect companion piece for joint publication. “I suggest we add them as co-authors and write up the paper for a top tier journal,” Gino later wrote, by e-mail.