This is the interview with Laurie Santos from episode 040 of the You Are Not So Smart Podcast.
Laurie Santos heads the Comparative Cognition Laboratory at Yale University. In that lab, she and her colleagues are exploring the fact that when two species share a relative on the evolutionary family tree, not only do they share similar physical features, but they also share similar behaviors. Psychologists and other scientists have used animals to study humans for a very long time, but Santos and her colleagues have taken it a step further by choosing to focus on a closer relation, the capuchin monkey; that way they could investigate subtler, more complex aspects of human decision making – like cognitive biases.
DAVID: First of all, Laurie, you have one of the coolest jobs in the world, so would you mind describing what exactly happens at your comparative cognition laboratory?
LAURIE: Yeah, sure. I am interested in both the smart and dumb things that make people special, and I study that question by studying how other primates make decisions. We have a colony of capuchin monkeys. It’s like a big zoo enclosure of monkeys, and we do a bunch of studies with them about how they make decisions. We also do some work at a field site known as Cayo Santiago, which is an island off the coast of Puerto Rico that’s home to about 1,000 free ranging monkeys. They kind of run around and do their monkey thing, and we can show up and set up studies to try to look at how they think about the world.
DAVID: I think a lot of people are going to hear that, and they’re going to immediately think you’re studying people by studying monkeys.
DAVID: I’m really happy to have you on the show because I think that the reason why you do that, and I’ll give you a chance to answer why that is, is because I think that anyone who begins to learn about biases, heuristics, fallacies, and all that stuff will usually begin to wonder what are the origins of these irrational behaviors in decision-making models and all this stuff. One of the biggest questions in psychology is always about whether or not you can sort things out to just see: does this particular behavior or strategy spring from culture, or is this more biological in origin and it’s just being expressed through some sort of cultural filter? Why do you study monkeys to study people, and how is your research sort of attacking that question of origin?
LAURIE: Yeah, so I think you kind of hit the nail on the head, really. We want to know where some of these biases come from, right? It’s a kind of strange thing to think that they might come from something within our phylogeny or something that we’re built to do because usually when we think of the kinds of things we might be built for, we think of smarter sorts of decisions and smarter sorts of capacities, right? You kind of build in — natural selection wants to build in the stuff that’s particularly smart and of stuff that’s going to help you get out, survive, make good decisions, reproduce, and so on.
It’s a little bit strange to think that some of our biases might be built in, but the fact of the matter is, as you’ve seen on your show tons of time, people don’t overcome these biases as quickly as you’d think. A lot of our heuristics seem to be engrained. You hear about them, and you hear that you shouldn’t do them, but that doesn’t stop you from showing the bias on the next example that you give.
That suggested to us that some of these things might be a bit more automatic than we expect, and they might be a little bit more deeply engrained than we expected. That was one of the reasons we started to turn to monkeys to try to see, well, if these things are really evolutionarily old, maybe we’re not the only species that shows them. We’re the only species that has podcasts about biases, rich economic markets, and these things, but maybe these strategies are there for something much older. We kind of embarked on this mission to study biases and irrationalities in the monkeys, and we’ve been really surprised with some of the similarities we’ve seen so far.
DAVID: Yeah, it is so cool. It’s such an awesome way to attack this problem.
LAURIE: It also means I get to hang out with fun, furry creatures in warm places, which has a nice perk too.
DAVID: We should note, of course, just, anyone who may still have that foggy notion, these are not our ancestors, but we share an ancestor. We know all the evidence suggests we share an ancestor.
LAURIE: That’s right. In an ideal world, we’d be able to run all our studies with direct ancestors like australopithecine or homoerectus or something, but it’s hard to recruit subjects because they’re all dead. We would be waiting for some folks to sign up for a long time, and so we kind of need to use a proxy. It’s worth remembering that they are a proxy. They too have been on their own evolutionary path for 35 million years, but they’re still one of the best windows that we have into what’s going on in human cognition.
DAVID: Would I be right? Tell me if I’m just an idiot. It’s sort of like big cats and house cats. They share a lot of similar behaviors, they look very similar, and they both respond to certain chemicals. I’ve seen tigers and lions will play around in catnip and stuff like that.
DAVID: But if you look on their evolutionary tree, they share a common ancestor many millions of years ago, yet they still have many of the same behaviors. We can sort of maybe and it may be true that they, both the big cats and the small cats, the house cats, have inherited those behaviors from a common ancestor a long time ago, right?
LAURIE: Yep, and that’s the idea between us and them. We each have primate-like brains and primate-like hands. Those come from a common ancestor that we shared back in the day. We both got it a long time ago, and we’ve kept it over our evolutionary path. That’s what we’re trying to look at with some of these biases.
The idea is that maybe it’s not just modern humans that show this stuff. Maybe it’s wound up turning up in our primate lineage way back in the day and, therefore, we both kind of stuck with it over evolutionary time. If so, then we can kind of use other species as kind of a window back into our past. They’re kind of like a little experimental time machine because we can kind of get a glimpse of the kind of stuff we shared with our common ancestor way back in the day by seeing similarities. Yeah.
DAVID: Yeah, that’s fantastic. I like that it’s not just purely speculation, that it’s not like maybe people like berries because–
DAVID: You’re actually out there in the trenches actually doing crazy stuff like creating monkey marketplaces, which I love that you named it that. Tell me what is a monkey marketplace? What goes on in there?
LAURIE: Well, we kind of devised the monkey marketplace. When I say we, it’s myself in collaboration with a student, Venkat Lakshminarayanan, and a colleague, Keith Chen, who is an economist at UCLA. What we decided to do together was to come up with a way that we could test whether or not monkeys had these biases.
Now, most of the human biases you see in the context of these little financial gambles, right: Do you want $1,000 now or – blah, blah, blah? What we wanted to do was to test the monkeys using the same methods as folks have tested the same biases in people. That meant trying to teach the monkeys their own currency so we have kind of a unit about which to ask them. Of course, monkeys don’t use money, so this was kind of experimental hurdle number one.
It turned out that there was lots of evidence that other primates were pretty good at using these little tokens to trade with people for food and other resources. We said, well, let’s train our capuchin monkeys to use some tokens, and we’ll just try to see, from that training, what do they understand about it. We introduced monkeys to little tokens. They are little metal washers that we just got at Home Depot. We taught the monkeys that they could kind of trade those washers with people for food.
Our capuchins are really curious little critters. They walk over and pick up these tokens, as soon as they see them, like, what are these weird things. They see this human in the center who is holding a piece of food, and so they kind of come over to see what’s that food. The human kind of swaps the food for the token.
Really, with a couple of experiences just like this, the monkeys pick up, like, “Oh, I get it. I give them this token and then I get some food.” That was kind of step one.
Then step two is to see: We just taught them some strange party trick or did the monkeys really understand something about these tokens like a real fiat currency, something that they could trade and that held onto value, and that they cared about kind of maximizing their value of and so on. To test this, we quite literally put the monkeys into their own market. Whenever the monkeys wanted some food, they could come out of their big social enclosure through this little tunnel, which is where we do our testing and, when they got to the end of the tunnel, they’d see a little wallet filled with tokens.
What they could do is just spend those tokens to buy food in any way they wanted. Usually they had a choice of two different experimenters in the lab, just students in the lab, who wore different clothing and sold food at different prices. The monkeys could use their token to buy one grape from one experimenter, or they could buy one apple piece from a second experimenter. We just asked: How do they spend their budget?
We were interested in whether they did some of the rational things that people do. People aren’t all heuristics and biases. Sometimes we show these sort of rational behaviors. We wanted to see whether the monkeys were kind of rational in some of the same spots as people are.
We asked: Do they try to maximize expected value? If they have a choice between a guy who is selling one grape and a guy who is selling two grapes, did they kind of shop at the guy who gives them more? The surprising answer, even with really little training, was yes. The monkeys, when they had that choice, they shopped at rates of about 80% or 90% at the guy who was giving them twice as much food.
We also found that they could calculate their risk of different experiments. Sometimes we gave them choices between experimenters who did different things on different trials, and we found they could kind of average what people did over time to get a sort of average expected value from the different experimenters. It was pretty remarkable, particularly when dealing with kind of output and price is that the monkeys seemed to do exactly what we would expect of human traders. My colleague Keith is fond of saying that if you just had the monkeys’ data in a spreadsheet, and you didn’t know, you’d think they were price shifting as well as a human trader, so they were pretty sharp with this market.
DAVID: That is so awesome. I think we could probably assume that money and marketplaces, and these are sort of cultural inventions that human beings have created, and there are certain aspects of that you will find in different primates. I’ve seen there are monkeys that will dive for clams, and then they will use rocks to open the clams.
DAVID: There are some that famously wash potatoes, that sort of stuff.
DAVID: These are things that — there’s not a gene. There’s not a part of the brain that says, “Wash potatoes.”
LAURIE: Yeah. They’re good at socially learning and good at picking this stuff up. The other thing is, in their natural environment, they have all these kind of market-like structures that they have to navigate. If you’ve seen any nature videos, you know other primates groom one another. There’s this question about how long should you groom somebody. Should you care about how much they groomed you? Should you get your grooming expected value and so on?
Lots of biologists have talked about this term biological markets, the kind of real goods and services that animals exchange with one another. They have to track that stuff. Probably some of the heuristics we’re using are the ones that are built for those kinds of markets, and we just kind of added fiat currencies, exchange rates, 401(k)s, and this other stuff, but the strategies are much older.
DAVID: That is great. Yes. Okay, that makes a lot of sense. When you’re in the dorm room and you’re having that conversation where you’re like, “Hey, man. You know that money is just paper?” And they’re like, “What?” Why do we care about paper? You’re discovering, without realizing it, the difference between culture and biology.
DAVID: The way we interact with that thing that we invented seems like it may actually have a more deeply evolutionary origin, that it comes off of primate foundations. Before we get into that, though, one of the things that you researched was specifically certain things from psychology, certain irrational behaviors we can reliably see pop up over and over again with human beings. One of them that I mentioned earlier in the show was if you had a choice between receiving $1,000 and you’re given a chance to add to it, or you’re given $2,000 and given a chance to lose some of it.
DAVID: You’ll have a slightly different response to it depending on the frame. Could you sort of take us through how you presented that exact same problem to monkeys and what you discovered?
LAURIE: Yeah. We knew we could present the monkeys with kind of guys who varied in risk. We could also present them with different experimenters who seemed to give you their bonuses or gains or, in contrast, losses. We gave the monkeys the $1,000 scenario by introducing monkeys to two different traders.
They both started with a small amount of food, so one piece of apple. But we had them both give bonuses, so the first experimenter gave a safe bonus. He always added a second apple piece to the one apple piece, so he gave always two. But the monkeys could choose this guy or the second guy. That guy also started with one piece of apple. Half the time he didn’t add anything. Half the time he gave a big bonus to give the monkeys three.
The expected value across the two is the same. They get two expectedly, but they kind of vary in how risky they are. The first guy is safe, and the second guy is pretty risky.
What we find there is that the monkeys, they tend to go with the safe guy. They tend to go with a consistent bonus of an extra one for two, which is fine. That could just be that the monkeys kind of avoid risk, just like humans. What we really wanted to see was whether the monkeys showed the framing effect. In other words, did they change their preference for risk when they were dealing with losses versus gains?
To test that, we gave the monkeys a second scenario with the same option for risk and the same expected value at the end. It’s just this time we framed it as a loss. To do that, we introduced the monkeys to two new traders. They each start with three pieces of apple, expect this time both experimenters are going to take some away.
The first guy takes them away safely. He always starts with three, and every single trial he takes one away to give two. The second guy is risky, so the second guy starts with three. Half the time he doesn’t take any away, but half the time he takes a lot away to give the monkeys only one.
Expected value is exactly the same, and the amount of risk is exactly the same, but what we find is that the monkeys here shift their preference. Now, instead of going with the safe guy, they tend to shop at the risky experimenter. Amazingly, they show exactly the same framing effect that people show, which we found to be both surprising and kind of pretty cool.
DAVID: It is cool. This problem, like a lot of problems in this realm of psychology, I always sit down and write it out so that I can understand.
LAURIE: Yeah, yeah.
DAVID: So I can understand, why can’t I see this the way it actually is the first time through?
DAVID: When you write it out it’s like one guy; it’s one grape always adds one, so you always get two.
DAVID: The other guy, one grape or one slice of apple, sometimes gives you two, sometimes nothing, so it’s either three or one. In the second run, it’s three pieces of food, always takes one, end up with two.
DAVID: Other person, start out with three, sometimes takes two, and so it’s one. It’s the same thing every time.
DAVID: Always two–
LAURIE: And they showed us before, which was cool, that they can track this. They can track expected value. They know when it’s the same thing every time. It’s just when you set up the frame, now when it looks like a bonus, it’s like, “Ooh, cool, bonuses. Better get that consistently.” When it’s a loss, it’s like, “Oh, no, this is terrible. How can I avoid this? Let me take on way more risk.”
LAURIE: It’s really incredible.
DAVID: I do it immediately. Even knowing it’s coming up, I still feel these feelings.
DAVID: Even though I know it’s the exact same scenario, it still feels different. I’ve shown this to other people just this week because I wanted to see it in action.
DAVID: Everyone makes the same mistake.
LAURIE: Yep. The other thing that I find funny is when I talk about this stuff, it’s curious people’s reaction to their own mistake because can do the math. They know their intuition is, like, wrong. It’s always pretty funny to people when they realize what they’re doing wrong, right? I think this is one of the great things about your podcast is that some of our own reactions to our own dumb biases is to kind of find the really funny.
LAURIE: I don’t know why we find our rationality funny, but yeah, that’s the reaction. The monkeys are meta-aware enough to realize they’ve done something silly. But if they were, maybe they would find it humorous too. Who knows?
DAVID: The reason I love what you do so much is that I get this question all the time when we talk about irrational behavior, flawed judgments, and quirky decision-making, all that stuff, is that people are always like, “Well, if people are so smart, if we can make cities, iPhones, and cure polio, why are we so dumb in all these other ways? How did we ever get here if all the stuff was between us and doing the right thing?” I’m interested to hear how you would answer that question.
LAURIE: Yeah. I think a couple things. One is that natural selection can’t build an ideal world, right? It’s got to work with the materials it has. Sometimes it just does the best with a bad set of kind of ingredients. It often ends up in these sort of local minima where some strategy is good for some stuff. It ultimately might be bad. But if it’s not so bad that you’re really taking a kind of fitness or a reproductive hit, it’s probably okay and it’s going to hang out, right?
If you look in our eye, you can see that we have this sort of funny blind spot, which is kind of an accident the way the eye is organized. We’ve got all kinds of weird stuff floating around in our bodies like appendices, just stuff that we’d design it differently if we were designing from scratch, but that’s not how it works. That’s one possibility with these strategies, right?
Maybe we’re not going to do the kinds of calculations we can do with super computers in our head. We’re not going to be perfectly rational like an economist. We’ve just got this blog of brain tissue. That’s what we’re working with. Maybe we’re making the best that we can; we’re doing the best that we can given that.
Another possibility though is that these strategies get used for all kinds of things that they weren’t meant for. And so, a second possibility is that these kinds of heuristics are good for something. It’s just we kind of apply them in strange ways. If you think back to the biological markets I was talking about, you get hints that some of the biases we’re seeing might be more useful in that context.
You’re now a monkey in the forest and you have to decide how long to groom somebody. You run into Bob, and you have to say, “All right, how long do I groom Bob?” Well, absolute terms of grooming don’t make much sense here, right? You wouldn’t want to think like an economist and figure out your absolute amount of grooming. You’d probably want to use a heuristic, right? It might be like, “How long did Bob groom me yesterday?” Well, if it was one hour then great. Groom him for one hour. If it was two hours, then you have to kind of step it up.
That gets you to something like the bias that we’re showing what folks call reference dependence, this idea that we’re setting up these frames. We’re setting up these reference points. It also gets us to be a little bit loss adverse, right? It shouldn’t matter how much Bob absolutely groomed you, but if he groomed you less than you groomed him, then you need some mechanisms to get upset about that and find a reverse, and so on.
LAURIE: I think one nice thing about this work is that it reframes these things from biases and errors, and it puts in perspective, well, could these kinds of strategies be useful for something? Maybe we’re kind of just applying them in strange ways now, but that doesn’t mean, over time, they were bad for stuff.
DAVID: That’s great. They’re adaptive, but not–
LAURIE: Not for everything.
DAVID: Not for everything.
DAVID: They’re being placed in weird scenarios, right?
LAURIE: Yeah, and I think we see that with a lot of the kinds of strategies that natural selection has built in, right? I have a strategy built in for many years over primate evolution to seek out sweet, fatty foods. It’s like I have a Krispy Kreme detector in my head that goes off and says, “Yes, yes, yes, eat.”
DAVID: I have that same detector.
LAURIE: Yeah, and that was useful when you and I had ancestors that were running around the savanna where there were no Krispy Kremes everywhere. We had to do our best to find Krispy Kreme-like things because it was hard to get food and to get the right number of calories. Now, millions of years later, you and I are walking around the streets of our favorite cities and those things are everywhere. They were useful back then, but they’re not now, and they’re still pretty hard to shut off, right?
LAURIE: Often these things that were useful back then are kind of playing out in these contexts that natural selection at the time of our ancestors never could have imagined. It looks bad now, but it doesn’t mean it was bad back in the day when we were really using them.
DAVID: I think this all the time, and I have zero evidence for this. This is just some crazy stuff that pops in my head, but I think that part of what you’re saying what you’ve done here is you’ve taken these strange things that we’ve created, these things that these monkeys wouldn’t do naturally. They’re adaptive that don’t necessarily pose many problems to them in their natural habitat and their normal, undisturbed monkey lives. But you’ve foisted upon these human created institutions and then the behavior gets expressed sort of the same way we do it, right?
DAVID: That would normally be adaptive for one scenario, but then you put them into our scenarios, and they’re like, “Oh, okay. I’ll go with the guy that gives you this.”
DAVID: You see a lot of this, not just the Krispy Kreme example, but I think that this is sort of also happening, like, with Twitter, on Twitter, and other social media. Here’s an absolutely new environment for our behaviors to express themselves and to flourish in ways they’ve never flourished. You get things like Twitter dog piles where people get absolutely assaulted by thousands of people over one thing that they’ve said or maybe a misunderstanding or maybe they are appropriately being lambasted. Either way, it’s a completely new way to express a very old pattern of behavior, this social manifestation of an old, probably primate paradigm. It’s really crazy to see how that works out, and I think I see it in a lot of places.
Every time we create new technology and we sort of create a new way of being a person, we have to, each of us, become better at controlling a lot of these old strategies because, just like you have to be a good user of the brain when you discover that you can eat whatever you want whenever you want, you have to be a good user of the brain when you discover that I can’t instantly just say whatever I feel like to millions of people.
LAURIE: Yeah. I think we also have to become better makers of technology, right? You could imagine that if the designers of Twitter, Facebook, or whatever knew more about primate behavior and our heuristics, they might design things a little bit differently because it’s tricky. In my experience, a lot of these strategies are tricky to overcome without the right situation.
Your podcast is fantastic, but folks will leave here, and they’re still going to have the intuition when they see that $1,000 problem of what they should do, and they’re still going to look like a monkey, right? That means that the onus in some ways is on the folks who create these structures to try to create them in ways that don’t allow our biases to kind of go crazy and wreak havoc.
LAURIE: I think there are intuitions in some of the business and policy world about how we can do this. We’ve seen, I think, a lot of headway in how to design better situations with regard to our food biases and stuff like that. Folks have better intuitions about how to do that. I think the more we think about that, not just in policy or political domains, but in domains that we face in everyday life, like on Twitter, like on these kinds of strange apps and so on, people will be a lot happier because it’s tricky to get folks in the moment to rein in their biases. It’s better just to set them up so that the biases won’t run amuck in a particular situation.
DAVID: Right, yeah. Part of it is just we seem to have this confidence that, well, I’m not going to fall for that.
LAURIE: Exactly, yeah. Yeah, or, like, “Now I know. Now I know about reference dependence and loss aversion. I won’t fall for that.”
My colleague who is a philosopher here at Yale, Tamar Gendler, and I have christened what we hope will take as a new bias name. We call it the GI Joe Fallacy.
DAVID: Okay. Tell me about this.
LAURIE: I’m not sure how old you are, David, but if you’re a child of the ’80s, you know this terrible cartoon show called GI Joe.
DAVID: Yes. Yes, I’ve seen every episode.
LAURIE: Awesome, yeah, so you know that it ends with this sort of parable at the end where GI Joe gives this important information, and the child says, “Well, now I know.” And knowing is half the battle.
LAURIE: Tamar and I say that the GI Joe Fallacy is that knowing is not half the battle when it comes to these biases. You can know about these biases like crazy. You could be complete experts in them and written papers about them, but that doesn’t mean you’re not going to experience them as soon as you’re put in the right situation. We think this is yet another bias, that people think, once they know about these biases, that’s kind of most of it, and they kind of go away. But actually, in our view, it’s not half the battle. It’s probably more like maybe a tenth or a fifth of the battle if I had to measure it.
It’s amazing to us that even experts have this fallacy. You see this sometimes in some of my favorite popular books about heuristics and biases. They have this part in the introduction and in the discussion that kind of reads like GI Joe parable about, like, “Now you know, and go off into the world.” I think that is a fallacy. We’re just not going to shut this stuff off easily.
To me, it’s going to work a lot like my Krispy Kreme bias that every time somebody plops a holiday cookie in front of me, I’m going to have my hunter/gatherer brain telling me to eat it. It doesn’t matter how much I know my cholesterol, know how bad it is, or know the nutrition content, I’m just going to want to eat it. My guess is, every time you see a scenario structured like that $1,000 problem, you’re just going to have the intuition to overweight the losses, even if you know better.
LAURIE: This raises a challenge because the normal ways we teach people stuff doesn’t work for evolutionarily old biases. I think that gives our species some new challenges when we find biases that are really old that we want to overcome. We can’t just kind of train people out of them, as I think lots of economists have thought for a while.
DAVID: Mm-hmm, mm-hmm.
LAURIE: I think we have to get better and creatively design better situations. That’s what’s going to release us from their hold.
DAVID: I certainly think that there is some sort of movement happening across several different disciplines, and your research is a huge portion of that movement. It’s definitely in the popular culture now, which means that people are thinking about and noticing it. I’ve read from several different — several different people have written on this sort of looking at it as a shift, going from geocentrism to heliocentrism. It’s going from taking human beings slowly, carefully, gingerly offering a hand and taking them off of this pedestal so that we can be better at building better institutions and stuff that sort of reflect how we really are instead of how we would like to be and how we think we could be.
LAURIE: The funny thing for me is, like, it doesn’t seem like we have a hard time with this in other domains outside of rationality. We have certain biological limitations. You’re not in my town right now. We’re talking via Skype. Your listeners are listening via a podcast. We’re okay with our biological limitation of how far our voice throws. We develop technology to deal with that, right?
LAURIE: I’m sitting here wearing contact lenses. I have this biological limitation about what I can see. I don’t feel bad or feel embarrassed that I need contact lenses to see better. I just like to see better.
The funny thing is, when it comes to our psychology, we don’t like to admit that we need these kinds of crutches even though every other part of our biology and our nature, we had to enhance it somehow. Why not have to enhance our rationality and our decisions? Somehow it feels weird in this way that other things don’t.
I think your analogy to geocentrism is a good one. It’s in part because we don’t like admitting that we’re not the top dog, the top place in nature, and this perfect, rational, God-like thing. We don’t like admitting that stuff, and those are the domains where we really need a lot of work to have a paradigm shift in.
LAURIE: I agree, it feels like it’s happening now, which is really exciting because my sense is, so many of the problems that we face as a species, as a planet, all this stuff, these days it has to do with human behavior. It has to do with human choices. Unless we get this stuff right, we’re in for a not fun ride, I guess.
DAVID: I was having breakfast with my father just the other day, and he was telling me about his strategy at the casino whenever he gets on a run.
DAVID: He’s like, “You know when the cards are winning, they’re winning. That’s when you’ve got to stay.” I’m like, “Well, look.” I started to explain this whole thing about random patterns and when it looks like a run, etc. It’s just so built into who we are as people.
DAVID: No matter how educated or how world-wise you are, you will fall prey to this stuff, and it’s good to know that this stuff exists. Hopefully it’s getting out there, and I know that your work is helping with it.
DAVID: I love it. To sort of leap out of that place, I’ve noticed that your most recent research is starting to reveal some ways that maybe you’re teasing out the sort of unique human qualities. Now, if our human mind is built on a sort of shared primate foundation, on top of that they’re going to have some things that we don’t, and we’re going to have some things that they don’t. What are some things that you’ve discovered or that seem to be coming out of your research that are uniquely human?
LAURIE: Yeah. Well, this stuff has been especially fun, in part because we got into this stuff expecting to see differences. Again, we’re the only ones having these podcasts. They’re not, so something is different, right? What is it?
What we’re starting to find is that some of the things that are different might make us uniquely irrational in some interesting ways. The first spot that we saw this came out of some studies we were doing to see if monkeys showed some classic price biases. This is just the bias that, as humans, we tend to confuse price and value or price and quality might be an even better way to say it.
LAURIE: We tend to think things that are more expensive are just going to be better. Even if you took exactly the same good and just gave it a higher price tag, we tend to see it as better. If I poured a glass of wine from a bottle that you saw had a $10 price tag, you’d sip it and think it tasted good in some way. But if I took exactly the same wine and just added $100 label, you would subjectively think that the wine tasted better – sometimes as high as three times better just because I gave it a better price tag.
Perhaps even more impressive, books like Dan Ariely and his colleagues have data suggesting that if you pay more for a pain medication, it actually works better. The same pain medication will work better if you pay a ton of money for it versus if you got it really cheaply. Somehow these kinds of price biases as a kind of confusion between higher prices and higher kind of quality seems pretty robust.
We wanted to see if we could see the same thing in the monkeys. When we started this work, based on the other findings we had, we kind of thought the monkeys would show this because the original work I did with Keith Chen and Venkat Lakshminarayanan showed that the monkeys knew a lot about price. They responded to sales. They kind of obeyed the standard economic pricing models. We thought they kind of got price in the same way as people do. And so we thought, given that they get price, maybe they’ll show this bias too.
We introduced the monkeys to different new foods, different new brands of food. We taught them in the market information about price, so they learned when they went shopping, like, “Ooh, this brand of Jell-O costs a lot of money, whereas this other brand of Jell-O is pretty cheap.”
We taught them all that stuff, and then we put the monkeys in a situation where they didn’t have to spend anything to get the food. They kind of went to a free monkey buffet. The idea there was that we could just see which ones they liked better. The intuition is, you might see $100 bottle of wine at your market, but not buy it because you’re trying to maximize your wine dollar. But if you went to a free holiday buffet and you saw that really expensive bottle of wine there, that might be the one you tried.
DAVID: Right, right.
LAURIE: We did this with the monkeys. We just basically let them eat whichever foods they wanted. What we found, across a bunch of different studies, was that the monkeys just didn’t fall for it. They had their preference for which one they liked, and they just didn’t change it depending on the price.
We did a bunch of controls to show that the monkeys understood the prices. They kind of got the study. They just weren’t showing this effect. It seems like this was the first spot in our market studies where we were finding that the monkeys were more rational than people. In other words, that people were kind of uniquely irrational.
This got us to thinking why in this domain are we doing something weird. It got us thinking more about what kind of information people take from price. One thing is all the economic stuff, like supply and demand, etc., etc. But another thing I think we take from price is we take a certain amount of social information from it. The reason I like the $100 wine is I know this is the wine that rich people get. When I’m in a posh restaurant in my town and I see the super expensive wine, I’m like, some investment banker who comes to this restaurant, that’s the one that he’s getting.
We started to think that it might be this social information that humans might uniquely start falling for. This is some work we’re kind of following up on now is that we might be uniquely automatically susceptible to the preferences and actions of others in a way that is special to our line in evolutionary history. In fact, there’s evidence that even our closest ancestors, chimpanzees, might not conform as much to the kind of bad strategies and bad preferences of people.
We’re starting to think that this might be a set of heuristics in which we’re special – kind of like follow other people to your peril. It might not be as evolutionarily old as we would like to think, which is kind of funny because folks often talk about, you know, monkey see – monkey do. It actually doesn’t seem to be it. It seems more to be sort of human see – human do, which is kind of interesting.
DAVID: Yeah. That is so fantastic. That is exciting. I’m just thinking of a buffet with cheeseburgers and cheese sticks, and caviar and fine cheeses, and human beings going, “Free caviar!”
LAURIE: Yeah. “This stuff is really expensive!” Yeah, I sometimes wonder that too. One of the reasons I study this stuff is I’m so susceptible to these biases. I have all the wrong intuition when it comes to this stuff, and particularly with the pricing biases.
I’ll go into my shop and see this posh, tiny, chocolate truffle and eat it and be like, “Oh, this is so delicious.” Part of me is thinking about this research and being like, “You know, this probably tastes exactly the same as that huge hunky bar of Hershey’s chocolate,” but yeah. I do think that we see these things in the economic domain, but it’s part of a broader, new thing that humans do.
LAURIE: Which is, we kind of rely on the information of others. It’s one of the reasons we have language. It’s one of the reasons we have podcasts. It’s one of the reasons we just kind of share stuff. But that has a downside, which is learning other people’s information affects what we think, what we believe, and what we prefer. Sometimes that’s good if you surround yourself with smart information, but in the case of these kinds of pricing biases, it might be bad in some cases too.
DAVID: I’m going to call it the Louis Vuitton Fallacy.
LAURIE: Yeah, exactly.
DAVID: What was so refreshing about this way of attacking this problem is that it just seems like it’s getting results. There’s so much in, when you start to approach the evolutionary question, it gets so speculative, and it can get really uncomfortable, weird, and sometimes nonsensical, silly, and eye-rolling. This just seems like it’s actually getting the goods, and I really like it. I love what you’re up to.
LAURIE: Yeah, we think it’s a fun kind of empirical way to test this stuff. Another great thing for us is there are lots of cases where we’ve been surprised. You really have to do these kinds of empirical studies. To understand your intuitions about what should be unique to humans or what should be special, you’ve got to kind of ask the animals to see what they do. Even experts like me are often surprised by what we get, what we find.
DAVID: I know people are going to be like, “I have to keep up with everything this person is doing.” How can people find you out there and keep up with what you’re up to?
LAURIE: They should check out some of our work on our lab website. These days the lab website is doglab.yale.edu. The reason it’s dog lab is that we’ve been trying to look at if there’s a nonhuman species that might be as interested in social information and social copying as people, and that has led us to some new studies on domesticated dogs. We’ve been bringing pet dogs from the New Haven area into our new center to do some economic studies on dogs, and so that’s kind of the new line of work, which you can check out at doglab.yale.edu.
Folks should also check out some of the stuff we talk about on Twitter. My Twitter handle is just my name, @LaurieSantos, on Twitter.
DAVID: All right, ma’am. Thank you so much for coming on the show. This is all great stuff and I wish you great fortune in your endeavors. This is so cool.
LAURIE: Thanks so much.