[Script Info]
Title: 
[Events]
Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:02.00,0:00:04.00,Default,,0000,0000,0000,,I want to start my talk today with two observations
Dialogue: 0,0:00:04.00,0:00:06.00,Default,,0000,0000,0000,,about the human species.
Dialogue: 0,0:00:06.00,0:00:09.00,Default,,0000,0000,0000,,The first observation is something that you might think is quite obvious,
Dialogue: 0,0:00:09.00,0:00:11.00,Default,,0000,0000,0000,,and that's that our species, Homo sapiens,
Dialogue: 0,0:00:11.00,0:00:13.00,Default,,0000,0000,0000,,is actually really, really smart --
Dialogue: 0,0:00:13.00,0:00:15.00,Default,,0000,0000,0000,,like, ridiculously smart --
Dialogue: 0,0:00:15.00,0:00:17.00,Default,,0000,0000,0000,,like you're all doing things
Dialogue: 0,0:00:17.00,0:00:20.00,Default,,0000,0000,0000,,that no other species on the planet does right now.
Dialogue: 0,0:00:20.00,0:00:22.00,Default,,0000,0000,0000,,And this is, of course,
Dialogue: 0,0:00:22.00,0:00:24.00,Default,,0000,0000,0000,,not the first time you've probably recognized this.
Dialogue: 0,0:00:24.00,0:00:27.00,Default,,0000,0000,0000,,Of course, in addition to being smart, we're also an extremely vain species.
Dialogue: 0,0:00:27.00,0:00:30.00,Default,,0000,0000,0000,,So we like pointing out the fact that we're smart.
Dialogue: 0,0:00:30.00,0:00:32.00,Default,,0000,0000,0000,,You know, so I could turn to pretty much any sage
Dialogue: 0,0:00:32.00,0:00:34.00,Default,,0000,0000,0000,,from Shakespeare to Stephen Colbert
Dialogue: 0,0:00:34.00,0:00:36.00,Default,,0000,0000,0000,,to point out things like the fact that
Dialogue: 0,0:00:36.00,0:00:38.00,Default,,0000,0000,0000,,we're noble in reason and infinite in faculties
Dialogue: 0,0:00:38.00,0:00:40.00,Default,,0000,0000,0000,,and just kind of awesome-er than anything else on the planet
Dialogue: 0,0:00:40.00,0:00:43.00,Default,,0000,0000,0000,,when it comes to all things cerebral.
Dialogue: 0,0:00:43.00,0:00:45.00,Default,,0000,0000,0000,,But of course, there's a second observation about the human species
Dialogue: 0,0:00:45.00,0:00:47.00,Default,,0000,0000,0000,,that I want to focus on a little bit more,
Dialogue: 0,0:00:47.00,0:00:49.00,Default,,0000,0000,0000,,and that's the fact that
Dialogue: 0,0:00:49.00,0:00:52.00,Default,,0000,0000,0000,,even though we're actually really smart, sometimes uniquely smart,
Dialogue: 0,0:00:52.00,0:00:55.00,Default,,0000,0000,0000,,we can also be incredibly, incredibly dumb
Dialogue: 0,0:00:55.00,0:00:58.00,Default,,0000,0000,0000,,when it comes to some aspects of our decision making.
Dialogue: 0,0:00:58.00,0:01:00.00,Default,,0000,0000,0000,,Now I'm seeing lots of smirks out there.
Dialogue: 0,0:01:00.00,0:01:02.00,Default,,0000,0000,0000,,Don't worry, I'm not going to call anyone in particular out
Dialogue: 0,0:01:02.00,0:01:04.00,Default,,0000,0000,0000,,on any aspects of your own mistakes.
Dialogue: 0,0:01:04.00,0:01:06.00,Default,,0000,0000,0000,,But of course, just in the last two years
Dialogue: 0,0:01:06.00,0:01:09.00,Default,,0000,0000,0000,,we see these unprecedented examples of human ineptitude.
Dialogue: 0,0:01:09.00,0:01:12.00,Default,,0000,0000,0000,,And we've watched as the tools we uniquely make
Dialogue: 0,0:01:12.00,0:01:14.00,Default,,0000,0000,0000,,to pull the resources out of our environment
Dialogue: 0,0:01:14.00,0:01:16.00,Default,,0000,0000,0000,,kind of just blow up in our face.
Dialogue: 0,0:01:16.00,0:01:18.00,Default,,0000,0000,0000,,We've watched the financial markets that we uniquely create --
Dialogue: 0,0:01:18.00,0:01:21.00,Default,,0000,0000,0000,,these markets that were supposed to be foolproof --
Dialogue: 0,0:01:21.00,0:01:23.00,Default,,0000,0000,0000,,we've watched them kind of collapse before our eyes.
Dialogue: 0,0:01:23.00,0:01:25.00,Default,,0000,0000,0000,,But both of these two embarrassing examples, I think,
Dialogue: 0,0:01:25.00,0:01:28.00,Default,,0000,0000,0000,,don't highlight what I think is most embarrassing
Dialogue: 0,0:01:28.00,0:01:30.00,Default,,0000,0000,0000,,about the mistakes that humans make,
Dialogue: 0,0:01:30.00,0:01:33.00,Default,,0000,0000,0000,,which is that we'd like to think that the mistakes we make
Dialogue: 0,0:01:33.00,0:01:35.00,Default,,0000,0000,0000,,are really just the result of a couple bad apples
Dialogue: 0,0:01:35.00,0:01:38.00,Default,,0000,0000,0000,,or a couple really sort of FAIL Blog-worthy decisions.
Dialogue: 0,0:01:38.00,0:01:41.00,Default,,0000,0000,0000,,But it turns out, what social scientists are actually learning
Dialogue: 0,0:01:41.00,0:01:44.00,Default,,0000,0000,0000,,is that most of us, when put in certain contexts,
Dialogue: 0,0:01:44.00,0:01:47.00,Default,,0000,0000,0000,,will actually make very specific mistakes.
Dialogue: 0,0:01:47.00,0:01:49.00,Default,,0000,0000,0000,,The errors we make are actually predictable.
Dialogue: 0,0:01:49.00,0:01:51.00,Default,,0000,0000,0000,,We make them again and again.
Dialogue: 0,0:01:51.00,0:01:53.00,Default,,0000,0000,0000,,And they're actually immune to lots of evidence.
Dialogue: 0,0:01:53.00,0:01:55.00,Default,,0000,0000,0000,,When we get negative feedback,
Dialogue: 0,0:01:55.00,0:01:58.00,Default,,0000,0000,0000,,we still, the next time we're face with a certain context,
Dialogue: 0,0:01:58.00,0:02:00.00,Default,,0000,0000,0000,,tend to make the same errors.
Dialogue: 0,0:02:00.00,0:02:02.00,Default,,0000,0000,0000,,And so this has been a real puzzle to me
Dialogue: 0,0:02:02.00,0:02:04.00,Default,,0000,0000,0000,,as a sort of scholar of human nature.
Dialogue: 0,0:02:04.00,0:02:06.00,Default,,0000,0000,0000,,What I'm most curious about is,
Dialogue: 0,0:02:06.00,0:02:09.00,Default,,0000,0000,0000,,how is a species that's as smart as we are
Dialogue: 0,0:02:09.00,0:02:11.00,Default,,0000,0000,0000,,capable of such bad
Dialogue: 0,0:02:11.00,0:02:13.00,Default,,0000,0000,0000,,and such consistent errors all the time?
Dialogue: 0,0:02:13.00,0:02:16.00,Default,,0000,0000,0000,,You know, we're the smartest thing out there, why can't we figure this out?
Dialogue: 0,0:02:16.00,0:02:19.00,Default,,0000,0000,0000,,In some sense, where do our mistakes really come from?
Dialogue: 0,0:02:19.00,0:02:22.00,Default,,0000,0000,0000,,And having thought about this a little bit, I see a couple different possibilities.
Dialogue: 0,0:02:22.00,0:02:25.00,Default,,0000,0000,0000,,One possibility is, in some sense, it's not really our fault.
Dialogue: 0,0:02:25.00,0:02:27.00,Default,,0000,0000,0000,,Because we're a smart species,
Dialogue: 0,0:02:27.00,0:02:29.00,Default,,0000,0000,0000,,we can actually create all kinds of environments
Dialogue: 0,0:02:29.00,0:02:31.00,Default,,0000,0000,0000,,that are super, super complicated,
Dialogue: 0,0:02:31.00,0:02:34.00,Default,,0000,0000,0000,,sometimes too complicated for us to even actually understand,
Dialogue: 0,0:02:34.00,0:02:36.00,Default,,0000,0000,0000,,even though we've actually created them.
Dialogue: 0,0:02:36.00,0:02:38.00,Default,,0000,0000,0000,,We create financial markets that are super complex.
Dialogue: 0,0:02:38.00,0:02:41.00,Default,,0000,0000,0000,,We create mortgage terms that we can't actually deal with.
Dialogue: 0,0:02:41.00,0:02:44.00,Default,,0000,0000,0000,,And of course, if we are put in environments where we can't deal with it,
Dialogue: 0,0:02:44.00,0:02:46.00,Default,,0000,0000,0000,,in some sense makes sense that we actually
Dialogue: 0,0:02:46.00,0:02:48.00,Default,,0000,0000,0000,,might mess certain things up.
Dialogue: 0,0:02:48.00,0:02:50.00,Default,,0000,0000,0000,,If this was the case, we'd have a really easy solution
Dialogue: 0,0:02:50.00,0:02:52.00,Default,,0000,0000,0000,,to the problem of human error.
Dialogue: 0,0:02:52.00,0:02:54.00,Default,,0000,0000,0000,,We'd actually just say, okay, let's figure out
Dialogue: 0,0:02:54.00,0:02:56.00,Default,,0000,0000,0000,,the kinds of technologies we can't deal with,
Dialogue: 0,0:02:56.00,0:02:58.00,Default,,0000,0000,0000,,the kinds of environments that are bad --
Dialogue: 0,0:02:58.00,0:03:00.00,Default,,0000,0000,0000,,get rid of those, design things better,
Dialogue: 0,0:03:00.00,0:03:02.00,Default,,0000,0000,0000,,and we should be the noble species
Dialogue: 0,0:03:02.00,0:03:04.00,Default,,0000,0000,0000,,that we expect ourselves to be.
Dialogue: 0,0:03:04.00,0:03:07.00,Default,,0000,0000,0000,,But there's another possibility that I find a little bit more worrying,
Dialogue: 0,0:03:07.00,0:03:10.00,Default,,0000,0000,0000,,which is, maybe it's not our environments that are messed up.
Dialogue: 0,0:03:10.00,0:03:13.00,Default,,0000,0000,0000,,Maybe it's actually us that's designed badly.
Dialogue: 0,0:03:13.00,0:03:15.00,Default,,0000,0000,0000,,This is a hint that I've gotten
Dialogue: 0,0:03:15.00,0:03:18.00,Default,,0000,0000,0000,,from watching the ways that social scientists have learned about human errors.
Dialogue: 0,0:03:18.00,0:03:21.00,Default,,0000,0000,0000,,And what we see is that people tend to keep making errors
Dialogue: 0,0:03:21.00,0:03:24.00,Default,,0000,0000,0000,,exactly the same way, over and over again.
Dialogue: 0,0:03:24.00,0:03:26.00,Default,,0000,0000,0000,,It feels like we might almost just be built
Dialogue: 0,0:03:26.00,0:03:28.00,Default,,0000,0000,0000,,to make errors in certain ways.
Dialogue: 0,0:03:28.00,0:03:31.00,Default,,0000,0000,0000,,This is a possibility that I worry a little bit more about,
Dialogue: 0,0:03:31.00,0:03:33.00,Default,,0000,0000,0000,,because, if it's us that's messed up,
Dialogue: 0,0:03:33.00,0:03:35.00,Default,,0000,0000,0000,,it's not actually clear how we go about dealing with it.
Dialogue: 0,0:03:35.00,0:03:38.00,Default,,0000,0000,0000,,We might just have to accept the fact that we're error prone
Dialogue: 0,0:03:38.00,0:03:40.00,Default,,0000,0000,0000,,and try to design things around it.
Dialogue: 0,0:03:40.00,0:03:43.00,Default,,0000,0000,0000,,So this is the question my students and I wanted to get at.
Dialogue: 0,0:03:43.00,0:03:46.00,Default,,0000,0000,0000,,How can we tell the difference between possibility one and possibility two?
Dialogue: 0,0:03:46.00,0:03:48.00,Default,,0000,0000,0000,,What we need is a population
Dialogue: 0,0:03:48.00,0:03:50.00,Default,,0000,0000,0000,,that's basically smart, can make lots of decisions,
Dialogue: 0,0:03:50.00,0:03:52.00,Default,,0000,0000,0000,,but doesn't have access to any of the systems we have,
Dialogue: 0,0:03:52.00,0:03:54.00,Default,,0000,0000,0000,,any of the things that might mess us up --
Dialogue: 0,0:03:54.00,0:03:56.00,Default,,0000,0000,0000,,no human technology, human culture,
Dialogue: 0,0:03:56.00,0:03:58.00,Default,,0000,0000,0000,,maybe even not human language.
Dialogue: 0,0:03:58.00,0:04:00.00,Default,,0000,0000,0000,,And so this is why we turned to these guys here.
Dialogue: 0,0:04:00.00,0:04:03.00,Default,,0000,0000,0000,,These are one of the guys I work with. This is a brown capuchin monkey.
Dialogue: 0,0:04:03.00,0:04:05.00,Default,,0000,0000,0000,,These guys are New World primates,
Dialogue: 0,0:04:05.00,0:04:07.00,Default,,0000,0000,0000,,which means they broke off from the human branch
Dialogue: 0,0:04:07.00,0:04:09.00,Default,,0000,0000,0000,,about 35 million years ago.
Dialogue: 0,0:04:09.00,0:04:11.00,Default,,0000,0000,0000,,This means that your great, great, great great, great, great --
Dialogue: 0,0:04:11.00,0:04:13.00,Default,,0000,0000,0000,,with about five million "greats" in there --
Dialogue: 0,0:04:13.00,0:04:15.00,Default,,0000,0000,0000,,grandmother was probably the same great, great, great, great
Dialogue: 0,0:04:15.00,0:04:17.00,Default,,0000,0000,0000,,grandmother with five million "greats" in there
Dialogue: 0,0:04:17.00,0:04:19.00,Default,,0000,0000,0000,,as Holly up here.
Dialogue: 0,0:04:19.00,0:04:22.00,Default,,0000,0000,0000,,You know, so you can take comfort in the fact that this guy up here is a really really distant,
Dialogue: 0,0:04:22.00,0:04:24.00,Default,,0000,0000,0000,,but albeit evolutionary, relative.
Dialogue: 0,0:04:24.00,0:04:26.00,Default,,0000,0000,0000,,The good news about Holly though is that
Dialogue: 0,0:04:26.00,0:04:29.00,Default,,0000,0000,0000,,she doesn't actually have the same kinds of technologies we do.
Dialogue: 0,0:04:29.00,0:04:32.00,Default,,0000,0000,0000,,You know, she's a smart, very cut creature, a primate as well,
Dialogue: 0,0:04:32.00,0:04:34.00,Default,,0000,0000,0000,,but she lacks all the stuff we think might be messing us up.
Dialogue: 0,0:04:34.00,0:04:36.00,Default,,0000,0000,0000,,So she's the perfect test case.
Dialogue: 0,0:04:36.00,0:04:39.00,Default,,0000,0000,0000,,What if we put Holly into the same context as humans?
Dialogue: 0,0:04:39.00,0:04:41.00,Default,,0000,0000,0000,,Does she make the same mistakes as us?
Dialogue: 0,0:04:41.00,0:04:43.00,Default,,0000,0000,0000,,Does she not learn from them? And so on.
Dialogue: 0,0:04:43.00,0:04:45.00,Default,,0000,0000,0000,,And so this is the kind of thing we decided to do.
Dialogue: 0,0:04:45.00,0:04:47.00,Default,,0000,0000,0000,,My students and I got very excited about this a few years ago.
Dialogue: 0,0:04:47.00,0:04:49.00,Default,,0000,0000,0000,,We said, all right, let's, you know, throw so problems at Holly,
Dialogue: 0,0:04:49.00,0:04:51.00,Default,,0000,0000,0000,,see if she messes these things up.
Dialogue: 0,0:04:51.00,0:04:54.00,Default,,0000,0000,0000,,First problem is just, well, where should we start?
Dialogue: 0,0:04:54.00,0:04:56.00,Default,,0000,0000,0000,,Because, you know, it's great for us, but bad for humans.
Dialogue: 0,0:04:56.00,0:04:58.00,Default,,0000,0000,0000,,We make a lot of mistakes in a lot of different contexts.
Dialogue: 0,0:04:58.00,0:05:00.00,Default,,0000,0000,0000,,You know, where are we actually going to start with this?
Dialogue: 0,0:05:00.00,0:05:03.00,Default,,0000,0000,0000,,And because we started this work around the time of the financial collapse,
Dialogue: 0,0:05:03.00,0:05:05.00,Default,,0000,0000,0000,,around the time when foreclosures were hitting the news,
Dialogue: 0,0:05:05.00,0:05:07.00,Default,,0000,0000,0000,,we said, hhmm, maybe we should
Dialogue: 0,0:05:07.00,0:05:09.00,Default,,0000,0000,0000,,actually start in the financial domain.
Dialogue: 0,0:05:09.00,0:05:12.00,Default,,0000,0000,0000,,Maybe we should look at monkey's economic decisions
Dialogue: 0,0:05:12.00,0:05:15.00,Default,,0000,0000,0000,,and try to see if they do the same kinds of dumb things that we do.
Dialogue: 0,0:05:15.00,0:05:17.00,Default,,0000,0000,0000,,Of course, that's when we hit a sort second problem --
Dialogue: 0,0:05:17.00,0:05:19.00,Default,,0000,0000,0000,,a little bit more methodological --
Dialogue: 0,0:05:19.00,0:05:21.00,Default,,0000,0000,0000,,which is that, maybe you guys don't know,
Dialogue: 0,0:05:21.00,0:05:24.00,Default,,0000,0000,0000,,but monkeys don't actually use money. I know, you haven't met them.
Dialogue: 0,0:05:24.00,0:05:26.00,Default,,0000,0000,0000,,But this is why, you know, they're not in the queue behind you
Dialogue: 0,0:05:26.00,0:05:29.00,Default,,0000,0000,0000,,at the grocery store or the ATM -- you know, they don't do this stuff.
Dialogue: 0,0:05:29.00,0:05:32.00,Default,,0000,0000,0000,,So now we faced, you know, a little bit of a problem here.
Dialogue: 0,0:05:32.00,0:05:34.00,Default,,0000,0000,0000,,How are we actually going to ask monkeys about money
Dialogue: 0,0:05:34.00,0:05:36.00,Default,,0000,0000,0000,,if they don't actually use it?
Dialogue: 0,0:05:36.00,0:05:38.00,Default,,0000,0000,0000,,So we said, well, maybe we should just, actually just suck it up
Dialogue: 0,0:05:38.00,0:05:40.00,Default,,0000,0000,0000,,and teach monkeys how to use money.
Dialogue: 0,0:05:40.00,0:05:42.00,Default,,0000,0000,0000,,So that's just what we did.
Dialogue: 0,0:05:42.00,0:05:45.00,Default,,0000,0000,0000,,What you're looking at over here is actually the first unit that I know of
Dialogue: 0,0:05:45.00,0:05:47.00,Default,,0000,0000,0000,,of non-human currency.
Dialogue: 0,0:05:47.00,0:05:49.00,Default,,0000,0000,0000,,We weren't very creative at the time we started these studies,
Dialogue: 0,0:05:49.00,0:05:51.00,Default,,0000,0000,0000,,so we just called it a token.
Dialogue: 0,0:05:51.00,0:05:54.00,Default,,0000,0000,0000,,But this is the unit of currency that we've taught our monkeys at Yale
Dialogue: 0,0:05:54.00,0:05:56.00,Default,,0000,0000,0000,,to actually use with humans,
Dialogue: 0,0:05:56.00,0:05:59.00,Default,,0000,0000,0000,,to actually buy different pieces of food.
Dialogue: 0,0:05:59.00,0:06:01.00,Default,,0000,0000,0000,,It doesn't look like much -- in fact, it isn't like much.
Dialogue: 0,0:06:01.00,0:06:03.00,Default,,0000,0000,0000,,Like most of our money, it's just a piece of metal.
Dialogue: 0,0:06:03.00,0:06:06.00,Default,,0000,0000,0000,,As those of you who've taken currencies home from your trip know,
Dialogue: 0,0:06:06.00,0:06:08.00,Default,,0000,0000,0000,,once you get home, it's actually pretty useless.
Dialogue: 0,0:06:08.00,0:06:10.00,Default,,0000,0000,0000,,It was useless to the monkeys at first
Dialogue: 0,0:06:10.00,0:06:12.00,Default,,0000,0000,0000,,before they realized what they could do with it.
Dialogue: 0,0:06:12.00,0:06:14.00,Default,,0000,0000,0000,,When we first gave it to them in their enclosures,
Dialogue: 0,0:06:14.00,0:06:16.00,Default,,0000,0000,0000,,they actually kind of picked them up, looked at them.
Dialogue: 0,0:06:16.00,0:06:18.00,Default,,0000,0000,0000,,They were these kind of weird things.
Dialogue: 0,0:06:18.00,0:06:20.00,Default,,0000,0000,0000,,But very quickly, the monkeys realized
Dialogue: 0,0:06:20.00,0:06:22.00,Default,,0000,0000,0000,,that they could actually hand these tokens over
Dialogue: 0,0:06:22.00,0:06:25.00,Default,,0000,0000,0000,,to different humans in the lab for some food.
Dialogue: 0,0:06:25.00,0:06:27.00,Default,,0000,0000,0000,,And so you see one of our monkeys, Mayday, up here doing this.
Dialogue: 0,0:06:27.00,0:06:30.00,Default,,0000,0000,0000,,This is A and B are kind of the points where she's sort of a little bit
Dialogue: 0,0:06:30.00,0:06:32.00,Default,,0000,0000,0000,,curious about these things -- doesn't know.
Dialogue: 0,0:06:32.00,0:06:34.00,Default,,0000,0000,0000,,There's this waiting hand from a human experimenter,
Dialogue: 0,0:06:34.00,0:06:37.00,Default,,0000,0000,0000,,and Mayday quickly figures out, apparently the human wants this.
Dialogue: 0,0:06:37.00,0:06:39.00,Default,,0000,0000,0000,,Hands it over, and then gets some food.
Dialogue: 0,0:06:39.00,0:06:41.00,Default,,0000,0000,0000,,It turns out not just Mayday, all of our monkeys get good
Dialogue: 0,0:06:41.00,0:06:43.00,Default,,0000,0000,0000,,at trading tokens with human salesman.
Dialogue: 0,0:06:43.00,0:06:45.00,Default,,0000,0000,0000,,So here's just a quick video of what this looks like.
Dialogue: 0,0:06:45.00,0:06:48.00,Default,,0000,0000,0000,,Here's Mayday. She's going to be trading a token for some food
Dialogue: 0,0:06:48.00,0:06:51.00,Default,,0000,0000,0000,,and waiting happily and getting her food.
Dialogue: 0,0:06:51.00,0:06:53.00,Default,,0000,0000,0000,,Here's Felix, I think. He's our alpha male; he's a kind of big guy.
Dialogue: 0,0:06:53.00,0:06:56.00,Default,,0000,0000,0000,,But he too waits patiently, gets his food and goes on.
Dialogue: 0,0:06:56.00,0:06:58.00,Default,,0000,0000,0000,,So the monkeys get really good at this.
Dialogue: 0,0:06:58.00,0:07:01.00,Default,,0000,0000,0000,,They're surprisingly good at this with very little training.
Dialogue: 0,0:07:01.00,0:07:03.00,Default,,0000,0000,0000,,We just allowed them to pick this up on their own.
Dialogue: 0,0:07:03.00,0:07:05.00,Default,,0000,0000,0000,,The question is: is this anything like human money?
Dialogue: 0,0:07:05.00,0:07:07.00,Default,,0000,0000,0000,,Is this a market at all,
Dialogue: 0,0:07:07.00,0:07:09.00,Default,,0000,0000,0000,,or did we just do a weird psychologist's trick
Dialogue: 0,0:07:09.00,0:07:11.00,Default,,0000,0000,0000,,by getting monkeys to do something,
Dialogue: 0,0:07:11.00,0:07:13.00,Default,,0000,0000,0000,,looking smart, but not really being smart.
Dialogue: 0,0:07:13.00,0:07:16.00,Default,,0000,0000,0000,,And so we said, well, what would the monkeys spontaneously do
Dialogue: 0,0:07:16.00,0:07:19.00,Default,,0000,0000,0000,,if this was really their currency, if they were really using it like money?
Dialogue: 0,0:07:19.00,0:07:21.00,Default,,0000,0000,0000,,Well, you might actually imagine them
Dialogue: 0,0:07:21.00,0:07:23.00,Default,,0000,0000,0000,,to do all the kinds of smart things
Dialogue: 0,0:07:23.00,0:07:26.00,Default,,0000,0000,0000,,that humans do when they start exchanging money with each other.
Dialogue: 0,0:07:26.00,0:07:29.00,Default,,0000,0000,0000,,You might have them start paying attention to price,
Dialogue: 0,0:07:29.00,0:07:31.00,Default,,0000,0000,0000,,paying attention to how much they buy --
Dialogue: 0,0:07:31.00,0:07:34.00,Default,,0000,0000,0000,,sort of keeping track of their monkey token, as it were.
Dialogue: 0,0:07:34.00,0:07:36.00,Default,,0000,0000,0000,,Do the monkeys do anything like this?
Dialogue: 0,0:07:36.00,0:07:39.00,Default,,0000,0000,0000,,And so our monkey marketplace was born.
Dialogue: 0,0:07:39.00,0:07:41.00,Default,,0000,0000,0000,,The way this works is that
Dialogue: 0,0:07:41.00,0:07:44.00,Default,,0000,0000,0000,,our monkeys normally live in a kind of big zoo social enclosure.
Dialogue: 0,0:07:44.00,0:07:46.00,Default,,0000,0000,0000,,When they get a hankering for some treats,
Dialogue: 0,0:07:46.00,0:07:48.00,Default,,0000,0000,0000,,we actually allowed them a way out
Dialogue: 0,0:07:48.00,0:07:50.00,Default,,0000,0000,0000,,into a little smaller enclosure where they could enter the market.
Dialogue: 0,0:07:50.00,0:07:52.00,Default,,0000,0000,0000,,Upon entering the market --
Dialogue: 0,0:07:52.00,0:07:54.00,Default,,0000,0000,0000,,it was actually a much more fun market for the monkeys than most human markets
Dialogue: 0,0:07:54.00,0:07:57.00,Default,,0000,0000,0000,,because, as the monkeys entered the door of the market,
Dialogue: 0,0:07:57.00,0:07:59.00,Default,,0000,0000,0000,,a human would give them a big wallet full of tokens
Dialogue: 0,0:07:59.00,0:08:01.00,Default,,0000,0000,0000,,so they could actually trade the tokens
Dialogue: 0,0:08:01.00,0:08:03.00,Default,,0000,0000,0000,,with one of these two guys here --
Dialogue: 0,0:08:03.00,0:08:05.00,Default,,0000,0000,0000,,two different possible human salesmen
Dialogue: 0,0:08:05.00,0:08:07.00,Default,,0000,0000,0000,,that they could actually buy stuff from.
Dialogue: 0,0:08:07.00,0:08:09.00,Default,,0000,0000,0000,,The salesmen were students from my lab.
Dialogue: 0,0:08:09.00,0:08:11.00,Default,,0000,0000,0000,,They dressed differently; they were different people.
Dialogue: 0,0:08:11.00,0:08:14.00,Default,,0000,0000,0000,,And over time, they did basically the same thing
Dialogue: 0,0:08:14.00,0:08:16.00,Default,,0000,0000,0000,,so the monkeys could learn, you know,
Dialogue: 0,0:08:16.00,0:08:19.00,Default,,0000,0000,0000,,who sold what at what price -- you know, who was reliable, who wasn't, and so on.
Dialogue: 0,0:08:19.00,0:08:21.00,Default,,0000,0000,0000,,And you can see that each of the experimenters
Dialogue: 0,0:08:21.00,0:08:24.00,Default,,0000,0000,0000,,is actually holding up a little, yellow food dish.
Dialogue: 0,0:08:24.00,0:08:26.00,Default,,0000,0000,0000,,and that's what the monkey can for a single token.
Dialogue: 0,0:08:26.00,0:08:28.00,Default,,0000,0000,0000,,So everything costs one token,
Dialogue: 0,0:08:28.00,0:08:30.00,Default,,0000,0000,0000,,but as you can see, sometimes tokens buy more than others,
Dialogue: 0,0:08:30.00,0:08:32.00,Default,,0000,0000,0000,,sometimes more grapes than others.
Dialogue: 0,0:08:32.00,0:08:35.00,Default,,0000,0000,0000,,So I'll show you a quick video of what this marketplace actually looks like.
Dialogue: 0,0:08:35.00,0:08:38.00,Default,,0000,0000,0000,,Here's a monkey-eye-view. Monkeys are shorter, so it's a little short.
Dialogue: 0,0:08:38.00,0:08:40.00,Default,,0000,0000,0000,,But here's Honey.
Dialogue: 0,0:08:40.00,0:08:42.00,Default,,0000,0000,0000,,She's waiting for the market to open a little impatiently.
Dialogue: 0,0:08:42.00,0:08:45.00,Default,,0000,0000,0000,,All of a sudden the market opens. Here's her choice: one grapes or two grapes.
Dialogue: 0,0:08:45.00,0:08:47.00,Default,,0000,0000,0000,,You can see Honey, very good market economist,
Dialogue: 0,0:08:47.00,0:08:50.00,Default,,0000,0000,0000,,goes with the guy who gives more.
Dialogue: 0,0:08:50.00,0:08:52.00,Default,,0000,0000,0000,,She could teach our financial advisers a few things or two.
Dialogue: 0,0:08:52.00,0:08:54.00,Default,,0000,0000,0000,,So not just Honey,
Dialogue: 0,0:08:54.00,0:08:57.00,Default,,0000,0000,0000,,most of the monkeys went with guys who had more.
Dialogue: 0,0:08:57.00,0:08:59.00,Default,,0000,0000,0000,,Most of the monkeys went with guys who had better food.
Dialogue: 0,0:08:59.00,0:09:02.00,Default,,0000,0000,0000,,When we introduced sales, we saw the monkeys paid attention to that.
Dialogue: 0,0:09:02.00,0:09:05.00,Default,,0000,0000,0000,,They really cared about their monkey token dollar.
Dialogue: 0,0:09:05.00,0:09:08.00,Default,,0000,0000,0000,,The more surprising thing was that when we collaborated with economists
Dialogue: 0,0:09:08.00,0:09:11.00,Default,,0000,0000,0000,,to actually look at the monkeys' data using economic tools,
Dialogue: 0,0:09:11.00,0:09:14.00,Default,,0000,0000,0000,,they basically matched, not just qualitatively,
Dialogue: 0,0:09:14.00,0:09:16.00,Default,,0000,0000,0000,,but quantitatively with what we saw
Dialogue: 0,0:09:16.00,0:09:18.00,Default,,0000,0000,0000,,humans doing in a real market.
Dialogue: 0,0:09:18.00,0:09:20.00,Default,,0000,0000,0000,,So much so that, if you saw the monkeys' numbers,
Dialogue: 0,0:09:20.00,0:09:23.00,Default,,0000,0000,0000,,you couldn't tell whether they came from a monkey or a human in the same market.
Dialogue: 0,0:09:23.00,0:09:25.00,Default,,0000,0000,0000,,And what we'd really thought we'd done
Dialogue: 0,0:09:25.00,0:09:27.00,Default,,0000,0000,0000,,is like we'd actually introduced something
Dialogue: 0,0:09:27.00,0:09:29.00,Default,,0000,0000,0000,,that, at least for the monkeys and us,
Dialogue: 0,0:09:29.00,0:09:31.00,Default,,0000,0000,0000,,works like a real financial currency.
Dialogue: 0,0:09:31.00,0:09:34.00,Default,,0000,0000,0000,,Question is: do the monkeys start messing up in the same ways we do?
Dialogue: 0,0:09:34.00,0:09:37.00,Default,,0000,0000,0000,,Well, we already saw anecdotally a couple of signs that they might.
Dialogue: 0,0:09:37.00,0:09:39.00,Default,,0000,0000,0000,,One thing we never saw in the monkey marketplace
Dialogue: 0,0:09:39.00,0:09:41.00,Default,,0000,0000,0000,,was any evidence of saving --
Dialogue: 0,0:09:41.00,0:09:43.00,Default,,0000,0000,0000,,you know, just like our own species.
Dialogue: 0,0:09:43.00,0:09:45.00,Default,,0000,0000,0000,,The monkeys entered the market, spent their entire budget
Dialogue: 0,0:09:45.00,0:09:47.00,Default,,0000,0000,0000,,and then went back to everyone else.
Dialogue: 0,0:09:47.00,0:09:49.00,Default,,0000,0000,0000,,The other thing we also spontaneously saw,
Dialogue: 0,0:09:49.00,0:09:51.00,Default,,0000,0000,0000,,embarrassingly enough,
Dialogue: 0,0:09:51.00,0:09:53.00,Default,,0000,0000,0000,,is spontaneous evidence of larceny.
Dialogue: 0,0:09:53.00,0:09:56.00,Default,,0000,0000,0000,,The monkeys would rip-off the tokens at every available opportunity --
Dialogue: 0,0:09:56.00,0:09:58.00,Default,,0000,0000,0000,,from each other, often from us --
Dialogue: 0,0:09:58.00,0:10:00.00,Default,,0000,0000,0000,,you know, things we didn't necessarily think we were introducing,
Dialogue: 0,0:10:00.00,0:10:02.00,Default,,0000,0000,0000,,but things we spontaneously saw.
Dialogue: 0,0:10:02.00,0:10:04.00,Default,,0000,0000,0000,,So we said, this looks bad.
Dialogue: 0,0:10:04.00,0:10:06.00,Default,,0000,0000,0000,,Can we actually see if the monkeys
Dialogue: 0,0:10:06.00,0:10:09.00,Default,,0000,0000,0000,,are doing exactly the same dumb things as humans do?
Dialogue: 0,0:10:09.00,0:10:11.00,Default,,0000,0000,0000,,One possibility is just kind of let
Dialogue: 0,0:10:11.00,0:10:13.00,Default,,0000,0000,0000,,the monkey financial system play out,
Dialogue: 0,0:10:13.00,0:10:15.00,Default,,0000,0000,0000,,you know, see if they start calling us for bailouts in a few years.
Dialogue: 0,0:10:15.00,0:10:17.00,Default,,0000,0000,0000,,We were a little impatient so we wanted
Dialogue: 0,0:10:17.00,0:10:19.00,Default,,0000,0000,0000,,to sort of speed things up a bit.
Dialogue: 0,0:10:19.00,0:10:21.00,Default,,0000,0000,0000,,So we said, let's actually give the monkeys
Dialogue: 0,0:10:21.00,0:10:23.00,Default,,0000,0000,0000,,the same kinds of problems
Dialogue: 0,0:10:23.00,0:10:25.00,Default,,0000,0000,0000,,that humans tend to get wrong
Dialogue: 0,0:10:25.00,0:10:27.00,Default,,0000,0000,0000,,in certain kinds of economic challenges,
Dialogue: 0,0:10:27.00,0:10:29.00,Default,,0000,0000,0000,,or certain kinds of economic experiments.
Dialogue: 0,0:10:29.00,0:10:32.00,Default,,0000,0000,0000,,And so, since the best way to see how people go wrong
Dialogue: 0,0:10:32.00,0:10:34.00,Default,,0000,0000,0000,,is to actually do it yourself,
Dialogue: 0,0:10:34.00,0:10:36.00,Default,,0000,0000,0000,,I'm going to give you guys a quick experiment
Dialogue: 0,0:10:36.00,0:10:38.00,Default,,0000,0000,0000,,to sort of watch your own financial intuitions in action.
Dialogue: 0,0:10:38.00,0:10:40.00,Default,,0000,0000,0000,,So imagine that right now
Dialogue: 0,0:10:40.00,0:10:42.00,Default,,0000,0000,0000,,I handed each and every one of you
Dialogue: 0,0:10:42.00,0:10:45.00,Default,,0000,0000,0000,,a thousand U.S. dollars -- so 10 crisp hundred dollar bills.
Dialogue: 0,0:10:45.00,0:10:47.00,Default,,0000,0000,0000,,Take these, put it in your wallet
Dialogue: 0,0:10:47.00,0:10:49.00,Default,,0000,0000,0000,,and spend a second thinking about what you're going to do with it.
Dialogue: 0,0:10:49.00,0:10:51.00,Default,,0000,0000,0000,,Because it's yours now; you can buy whatever you want.
Dialogue: 0,0:10:51.00,0:10:53.00,Default,,0000,0000,0000,,Donate it, take it, and so on.
Dialogue: 0,0:10:53.00,0:10:56.00,Default,,0000,0000,0000,,Sounds great, but you get one more choice to earn a little bit more money.
Dialogue: 0,0:10:56.00,0:10:59.00,Default,,0000,0000,0000,,And here's your choice: you can either be risky,
Dialogue: 0,0:10:59.00,0:11:01.00,Default,,0000,0000,0000,,in which case I'm going to flip one of these monkey tokens.
Dialogue: 0,0:11:01.00,0:11:03.00,Default,,0000,0000,0000,,If it comes up heads, you're going to get a thousand dollars more.
Dialogue: 0,0:11:03.00,0:11:05.00,Default,,0000,0000,0000,,If it comes up tails, you get nothing.
Dialogue: 0,0:11:05.00,0:11:08.00,Default,,0000,0000,0000,,So it's a chance to get more, but it's pretty risky.
Dialogue: 0,0:11:08.00,0:11:11.00,Default,,0000,0000,0000,,Your other option is a bit safe. Your just going to get some money for sure.
Dialogue: 0,0:11:11.00,0:11:13.00,Default,,0000,0000,0000,,I'm just going to give you 500 bucks.
Dialogue: 0,0:11:13.00,0:11:16.00,Default,,0000,0000,0000,,You can stick it in your wallet and use it immediately.
Dialogue: 0,0:11:16.00,0:11:18.00,Default,,0000,0000,0000,,So see what your intuition is here.
Dialogue: 0,0:11:18.00,0:11:21.00,Default,,0000,0000,0000,,Most people actually go with the play-it-safe option.
Dialogue: 0,0:11:21.00,0:11:24.00,Default,,0000,0000,0000,,Most people say, why should I be risky when I can get 1,500 dollars for sure?
Dialogue: 0,0:11:24.00,0:11:26.00,Default,,0000,0000,0000,,This seems like a good bet. I'm going to go with that.
Dialogue: 0,0:11:26.00,0:11:28.00,Default,,0000,0000,0000,,You might say, eh, that's not really irrational.
Dialogue: 0,0:11:28.00,0:11:30.00,Default,,0000,0000,0000,,People are a little risk-averse. So what?
Dialogue: 0,0:11:30.00,0:11:32.00,Default,,0000,0000,0000,,Well, the "so what?" comes when start thinking
Dialogue: 0,0:11:32.00,0:11:34.00,Default,,0000,0000,0000,,about the same problem
Dialogue: 0,0:11:34.00,0:11:36.00,Default,,0000,0000,0000,,set up just a little bit differently.
Dialogue: 0,0:11:36.00,0:11:38.00,Default,,0000,0000,0000,,So now imagine that I give each and every one of you
Dialogue: 0,0:11:38.00,0:11:41.00,Default,,0000,0000,0000,,2,000 dollars -- 20 crisp hundred dollar bills.
Dialogue: 0,0:11:41.00,0:11:43.00,Default,,0000,0000,0000,,Now you can buy double to stuff you were going to get before.
Dialogue: 0,0:11:43.00,0:11:45.00,Default,,0000,0000,0000,,Think about how you'd feel sticking it in your wallet.
Dialogue: 0,0:11:45.00,0:11:47.00,Default,,0000,0000,0000,,And now imagine that I have you make another choice
Dialogue: 0,0:11:47.00,0:11:49.00,Default,,0000,0000,0000,,But this time, it's a little bit worse.
Dialogue: 0,0:11:49.00,0:11:52.00,Default,,0000,0000,0000,,Now, you're going to be deciding how you're going to lose money,
Dialogue: 0,0:11:52.00,0:11:54.00,Default,,0000,0000,0000,,but you're going to get the same choice.
Dialogue: 0,0:11:54.00,0:11:56.00,Default,,0000,0000,0000,,You can either take a risky loss --
Dialogue: 0,0:11:56.00,0:11:59.00,Default,,0000,0000,0000,,so I'll flip a coin. If it comes up heads, you're going to actually lose a lot.
Dialogue: 0,0:11:59.00,0:12:02.00,Default,,0000,0000,0000,,If it comes up tails, you lose nothing, you're fine, get to keep the whole thing --
Dialogue: 0,0:12:02.00,0:12:05.00,Default,,0000,0000,0000,,or you could play it safe, which means you have to reach back into your wallet
Dialogue: 0,0:12:05.00,0:12:08.00,Default,,0000,0000,0000,,and give me five of those $100 bills, for certain.
Dialogue: 0,0:12:08.00,0:12:11.00,Default,,0000,0000,0000,,And I'm seeing a lot of furrowed brows out there.
Dialogue: 0,0:12:11.00,0:12:13.00,Default,,0000,0000,0000,,So maybe you're having the same intuitions
Dialogue: 0,0:12:13.00,0:12:15.00,Default,,0000,0000,0000,,as the subjects that were actually tested in this,
Dialogue: 0,0:12:15.00,0:12:17.00,Default,,0000,0000,0000,,which is when presented with these options,
Dialogue: 0,0:12:17.00,0:12:19.00,Default,,0000,0000,0000,,people don't choose to play it safe.
Dialogue: 0,0:12:19.00,0:12:21.00,Default,,0000,0000,0000,,They actually tend to go a little risky.
Dialogue: 0,0:12:21.00,0:12:24.00,Default,,0000,0000,0000,,The reason this is irrational is that we've given people in both situations
Dialogue: 0,0:12:24.00,0:12:26.00,Default,,0000,0000,0000,,the same choice.
Dialogue: 0,0:12:26.00,0:12:29.00,Default,,0000,0000,0000,,It's a 50/50 shot of a thousand or 2,000,
Dialogue: 0,0:12:29.00,0:12:31.00,Default,,0000,0000,0000,,or just 1,500 dollars with certainty.
Dialogue: 0,0:12:31.00,0:12:34.00,Default,,0000,0000,0000,,But people's intuitions about how much risk to take
Dialogue: 0,0:12:34.00,0:12:36.00,Default,,0000,0000,0000,,varies depending on where they started with.
Dialogue: 0,0:12:36.00,0:12:38.00,Default,,0000,0000,0000,,So what's going on?
Dialogue: 0,0:12:38.00,0:12:40.00,Default,,0000,0000,0000,,Well, it turns out that this seems to be the result
Dialogue: 0,0:12:40.00,0:12:43.00,Default,,0000,0000,0000,,of at least two biases that we have at the psychological level.
Dialogue: 0,0:12:43.00,0:12:46.00,Default,,0000,0000,0000,,One is that we have a really hard time thinking in absolute terms.
Dialogue: 0,0:12:46.00,0:12:48.00,Default,,0000,0000,0000,,You really have to do work to figure out,
Dialogue: 0,0:12:48.00,0:12:50.00,Default,,0000,0000,0000,,well, one option's a thousand, 2,000;
Dialogue: 0,0:12:50.00,0:12:52.00,Default,,0000,0000,0000,,one is 1,500.
Dialogue: 0,0:12:52.00,0:12:55.00,Default,,0000,0000,0000,,Instead, we find it very easy to think in very relative terms
Dialogue: 0,0:12:55.00,0:12:58.00,Default,,0000,0000,0000,,as options change from one time to another.
Dialogue: 0,0:12:58.00,0:13:01.00,Default,,0000,0000,0000,,So we think of things as, "Oh, I'm going to get more," or "Oh, I'm going to get less."
Dialogue: 0,0:13:01.00,0:13:03.00,Default,,0000,0000,0000,,This is all well and good, except that
Dialogue: 0,0:13:03.00,0:13:05.00,Default,,0000,0000,0000,,changes in different directions
Dialogue: 0,0:13:05.00,0:13:07.00,Default,,0000,0000,0000,,actually effect whether or not we think
Dialogue: 0,0:13:07.00,0:13:09.00,Default,,0000,0000,0000,,options are good or not.
Dialogue: 0,0:13:09.00,0:13:11.00,Default,,0000,0000,0000,,And this leads to the second bias,
Dialogue: 0,0:13:11.00,0:13:13.00,Default,,0000,0000,0000,,which economists have called loss aversion.
Dialogue: 0,0:13:13.00,0:13:16.00,Default,,0000,0000,0000,,The idea is that we really hate it when things go into the red.
Dialogue: 0,0:13:16.00,0:13:18.00,Default,,0000,0000,0000,,We really hate it when we have to lose out on some money.
Dialogue: 0,0:13:18.00,0:13:20.00,Default,,0000,0000,0000,,And this means that sometimes we'll actually
Dialogue: 0,0:13:20.00,0:13:22.00,Default,,0000,0000,0000,,switch our preferences to avoid this.
Dialogue: 0,0:13:22.00,0:13:24.00,Default,,0000,0000,0000,,What you saw in that last scenario is that
Dialogue: 0,0:13:24.00,0:13:26.00,Default,,0000,0000,0000,,subjects get risky
Dialogue: 0,0:13:26.00,0:13:29.00,Default,,0000,0000,0000,,because they want the small shot that there won't be any loss.
Dialogue: 0,0:13:29.00,0:13:31.00,Default,,0000,0000,0000,,That means when we're in a risk mindset --
Dialogue: 0,0:13:31.00,0:13:33.00,Default,,0000,0000,0000,,excuse me, when we're in a loss mindset,
Dialogue: 0,0:13:33.00,0:13:35.00,Default,,0000,0000,0000,,we actually become more risky,
Dialogue: 0,0:13:35.00,0:13:37.00,Default,,0000,0000,0000,,which can actually be really worrying.
Dialogue: 0,0:13:37.00,0:13:40.00,Default,,0000,0000,0000,,These kinds of things play out in lots of bad ways in humans.
Dialogue: 0,0:13:40.00,0:13:43.00,Default,,0000,0000,0000,,They're why stock investors hold onto losing stocks longer --
Dialogue: 0,0:13:43.00,0:13:45.00,Default,,0000,0000,0000,,because they're evaluating them in relative terms.
Dialogue: 0,0:13:45.00,0:13:47.00,Default,,0000,0000,0000,,They're why people in the housing market refused to sell their house --
Dialogue: 0,0:13:47.00,0:13:49.00,Default,,0000,0000,0000,,because they don't want to sell at a loss.
Dialogue: 0,0:13:49.00,0:13:51.00,Default,,0000,0000,0000,,The question we were interested in
Dialogue: 0,0:13:51.00,0:13:53.00,Default,,0000,0000,0000,,is whether the monkeys show the same biases.
Dialogue: 0,0:13:53.00,0:13:56.00,Default,,0000,0000,0000,,If we set up those same scenarios in our little monkey market,
Dialogue: 0,0:13:56.00,0:13:58.00,Default,,0000,0000,0000,,would they do the same thing as people?
Dialogue: 0,0:13:58.00,0:14:00.00,Default,,0000,0000,0000,,And so this is what we did, we gave the monkeys choices
Dialogue: 0,0:14:00.00,0:14:03.00,Default,,0000,0000,0000,,between guys who were safe -- they did the same thing every time --
Dialogue: 0,0:14:03.00,0:14:05.00,Default,,0000,0000,0000,,or guys who were risky --
Dialogue: 0,0:14:05.00,0:14:07.00,Default,,0000,0000,0000,,they did things differently half the time.
Dialogue: 0,0:14:07.00,0:14:09.00,Default,,0000,0000,0000,,And then we gave them options that were bonuses --
Dialogue: 0,0:14:09.00,0:14:11.00,Default,,0000,0000,0000,,like you guys did in the first scenario --
Dialogue: 0,0:14:11.00,0:14:13.00,Default,,0000,0000,0000,,so they actually have a chance more,
Dialogue: 0,0:14:13.00,0:14:16.00,Default,,0000,0000,0000,,or pieces where they were experiencing losses --
Dialogue: 0,0:14:16.00,0:14:18.00,Default,,0000,0000,0000,,they actually thought they were going to get more than they really got.
Dialogue: 0,0:14:18.00,0:14:20.00,Default,,0000,0000,0000,,And so this is what this looks like.
Dialogue: 0,0:14:20.00,0:14:22.00,Default,,0000,0000,0000,,We introduced the monkeys to two new monkey salesmen.
Dialogue: 0,0:14:22.00,0:14:24.00,Default,,0000,0000,0000,,The guy on the left and right both start with one piece of grape,
Dialogue: 0,0:14:24.00,0:14:26.00,Default,,0000,0000,0000,,so it looks pretty good.
Dialogue: 0,0:14:26.00,0:14:28.00,Default,,0000,0000,0000,,But they're going to give the monkeys bonuses.
Dialogue: 0,0:14:28.00,0:14:30.00,Default,,0000,0000,0000,,The guy on the left is a safe bonus.
Dialogue: 0,0:14:30.00,0:14:33.00,Default,,0000,0000,0000,,All the time, he adds one, to give the monkeys two.
Dialogue: 0,0:14:33.00,0:14:35.00,Default,,0000,0000,0000,,The guy on the right is actually a risky bonus.
Dialogue: 0,0:14:35.00,0:14:38.00,Default,,0000,0000,0000,,Sometimes the monkeys get no bonus -- so this is a bonus of zero.
Dialogue: 0,0:14:38.00,0:14:41.00,Default,,0000,0000,0000,,Sometimes the monkeys get two extra.
Dialogue: 0,0:14:41.00,0:14:43.00,Default,,0000,0000,0000,,For a big bonus, now they get three.
Dialogue: 0,0:14:43.00,0:14:45.00,Default,,0000,0000,0000,,But this is the same choice you guys just faced.
Dialogue: 0,0:14:45.00,0:14:48.00,Default,,0000,0000,0000,,Do the monkeys actually want to play it safe
Dialogue: 0,0:14:48.00,0:14:50.00,Default,,0000,0000,0000,,and then go with the guy who's going to do the same thing on every trial,
Dialogue: 0,0:14:50.00,0:14:52.00,Default,,0000,0000,0000,,or do they want to be risky
Dialogue: 0,0:14:52.00,0:14:54.00,Default,,0000,0000,0000,,and try to get a risky, but big, bonus,
Dialogue: 0,0:14:54.00,0:14:56.00,Default,,0000,0000,0000,,but risk the possibility of getting no bonus.
Dialogue: 0,0:14:56.00,0:14:58.00,Default,,0000,0000,0000,,People here played it safe.
Dialogue: 0,0:14:58.00,0:15:00.00,Default,,0000,0000,0000,,Turns out, the monkeys play it safe too.
Dialogue: 0,0:15:00.00,0:15:02.00,Default,,0000,0000,0000,,Qualitatively and quantitatively,
Dialogue: 0,0:15:02.00,0:15:04.00,Default,,0000,0000,0000,,they choose exactly the same way as people,
Dialogue: 0,0:15:04.00,0:15:06.00,Default,,0000,0000,0000,,when tested in the same thing.
Dialogue: 0,0:15:06.00,0:15:08.00,Default,,0000,0000,0000,,You might say, well, maybe the monkeys just don't like risk.
Dialogue: 0,0:15:08.00,0:15:10.00,Default,,0000,0000,0000,,Maybe we should see how they do with losses.
Dialogue: 0,0:15:10.00,0:15:12.00,Default,,0000,0000,0000,,And so we ran a second version of this.
Dialogue: 0,0:15:12.00,0:15:14.00,Default,,0000,0000,0000,,Now, the monkeys meet two guys
Dialogue: 0,0:15:14.00,0:15:16.00,Default,,0000,0000,0000,,who aren't giving them bonuses;
Dialogue: 0,0:15:16.00,0:15:18.00,Default,,0000,0000,0000,,they're actually giving them less than they expect.
Dialogue: 0,0:15:18.00,0:15:20.00,Default,,0000,0000,0000,,So they look like they're starting out with a big amount.
Dialogue: 0,0:15:20.00,0:15:22.00,Default,,0000,0000,0000,,These are three grapes; the monkey's really psyched for this.
Dialogue: 0,0:15:22.00,0:15:25.00,Default,,0000,0000,0000,,But now they learn these guys are going to give them less than they expect.
Dialogue: 0,0:15:25.00,0:15:27.00,Default,,0000,0000,0000,,They guy on the left is a safe loss.
Dialogue: 0,0:15:27.00,0:15:30.00,Default,,0000,0000,0000,,Every single time, he's going to take one of these away
Dialogue: 0,0:15:30.00,0:15:32.00,Default,,0000,0000,0000,,and give the monkeys just two.
Dialogue: 0,0:15:32.00,0:15:34.00,Default,,0000,0000,0000,,the guy on the right is the risky loss.
Dialogue: 0,0:15:34.00,0:15:37.00,Default,,0000,0000,0000,,Sometimes he gives no loss, so the monkeys are really psyched,
Dialogue: 0,0:15:37.00,0:15:39.00,Default,,0000,0000,0000,,but sometimes he actually gives a big loss,
Dialogue: 0,0:15:39.00,0:15:41.00,Default,,0000,0000,0000,,taking away two to give the monkeys only one.
Dialogue: 0,0:15:41.00,0:15:43.00,Default,,0000,0000,0000,,And so what do the monkeys do?
Dialogue: 0,0:15:43.00,0:15:45.00,Default,,0000,0000,0000,,Again, same choice; they can play it safe
Dialogue: 0,0:15:45.00,0:15:48.00,Default,,0000,0000,0000,,for always getting two grapes every single time,
Dialogue: 0,0:15:48.00,0:15:51.00,Default,,0000,0000,0000,,or they can take a risky bet and choose between one and three.
Dialogue: 0,0:15:51.00,0:15:54.00,Default,,0000,0000,0000,,The remarkable thing to us is that, when you give monkeys this choice,
Dialogue: 0,0:15:54.00,0:15:56.00,Default,,0000,0000,0000,,they do the same irrational thing that people do.
Dialogue: 0,0:15:56.00,0:15:58.00,Default,,0000,0000,0000,,They actually become more risky
Dialogue: 0,0:15:58.00,0:16:01.00,Default,,0000,0000,0000,,depending on how the experimenters started.
Dialogue: 0,0:16:01.00,0:16:03.00,Default,,0000,0000,0000,,This is crazy because it suggests that the monkeys too
Dialogue: 0,0:16:03.00,0:16:05.00,Default,,0000,0000,0000,,are evaluating things in relative terms
Dialogue: 0,0:16:05.00,0:16:08.00,Default,,0000,0000,0000,,and actually treating losses differently than they treat gains.
Dialogue: 0,0:16:08.00,0:16:10.00,Default,,0000,0000,0000,,So what does all of this mean?
Dialogue: 0,0:16:10.00,0:16:12.00,Default,,0000,0000,0000,,Well, what we've shown is that, first of all,
Dialogue: 0,0:16:12.00,0:16:14.00,Default,,0000,0000,0000,,we can actually give the monkeys a financial currency,
Dialogue: 0,0:16:14.00,0:16:16.00,Default,,0000,0000,0000,,and they do very similar things with it.
Dialogue: 0,0:16:16.00,0:16:18.00,Default,,0000,0000,0000,,They do some of the smart things we do,
Dialogue: 0,0:16:18.00,0:16:20.00,Default,,0000,0000,0000,,some of the kind of not so nice things we do,
Dialogue: 0,0:16:20.00,0:16:22.00,Default,,0000,0000,0000,,like steal it and so on.
Dialogue: 0,0:16:22.00,0:16:24.00,Default,,0000,0000,0000,,But they also do some of the irrational things we do.
Dialogue: 0,0:16:24.00,0:16:26.00,Default,,0000,0000,0000,,They systematically get things wrong
Dialogue: 0,0:16:26.00,0:16:28.00,Default,,0000,0000,0000,,and in the same ways that we do.
Dialogue: 0,0:16:28.00,0:16:30.00,Default,,0000,0000,0000,,This is the first take-home message of the Talk,
Dialogue: 0,0:16:30.00,0:16:32.00,Default,,0000,0000,0000,,which is that if you saw the beginning of this and you thought,
Dialogue: 0,0:16:32.00,0:16:34.00,Default,,0000,0000,0000,,oh, I'm totally going to go home and hire a capuchin monkey financial adviser.
Dialogue: 0,0:16:34.00,0:16:36.00,Default,,0000,0000,0000,,They're way cuter than the one at ... you know --
Dialogue: 0,0:16:36.00,0:16:38.00,Default,,0000,0000,0000,,Don't do that; they're probably going to be just as dumb
Dialogue: 0,0:16:38.00,0:16:41.00,Default,,0000,0000,0000,,as the human one you already have.
Dialogue: 0,0:16:41.00,0:16:43.00,Default,,0000,0000,0000,,So, you know, a little bad -- Sorry, sorry, sorry.
Dialogue: 0,0:16:43.00,0:16:45.00,Default,,0000,0000,0000,,A little bad for monkey investors.
Dialogue: 0,0:16:45.00,0:16:48.00,Default,,0000,0000,0000,,But of course, you know, the reason you're laughing is bad for humans too.
Dialogue: 0,0:16:48.00,0:16:51.00,Default,,0000,0000,0000,,Because we've answered the question we started out with.
Dialogue: 0,0:16:51.00,0:16:53.00,Default,,0000,0000,0000,,We wanted to know where these kinds of errors came from.
Dialogue: 0,0:16:53.00,0:16:55.00,Default,,0000,0000,0000,,And we started with the hope that maybe we can
Dialogue: 0,0:16:55.00,0:16:57.00,Default,,0000,0000,0000,,sort of tweak our financial institutions,
Dialogue: 0,0:16:57.00,0:17:00.00,Default,,0000,0000,0000,,tweak our technologies to make ourselves better.
Dialogue: 0,0:17:00.00,0:17:03.00,Default,,0000,0000,0000,,But what we've learn is that these biases might be a deeper part of us than that.
Dialogue: 0,0:17:03.00,0:17:05.00,Default,,0000,0000,0000,,In fact, they might be due to the very nature
Dialogue: 0,0:17:05.00,0:17:07.00,Default,,0000,0000,0000,,of our evolutionary history.
Dialogue: 0,0:17:07.00,0:17:09.00,Default,,0000,0000,0000,,You know, maybe it's not just humans
Dialogue: 0,0:17:09.00,0:17:11.00,Default,,0000,0000,0000,,at the right side of this chain that's duncey.
Dialogue: 0,0:17:11.00,0:17:13.00,Default,,0000,0000,0000,,Maybe it's sort of duncey all the way back.
Dialogue: 0,0:17:13.00,0:17:16.00,Default,,0000,0000,0000,,And this, if we believe the capuchin monkey results,
Dialogue: 0,0:17:16.00,0:17:18.00,Default,,0000,0000,0000,,means that these duncey strategies
Dialogue: 0,0:17:18.00,0:17:20.00,Default,,0000,0000,0000,,might be 35 million years old.
Dialogue: 0,0:17:20.00,0:17:22.00,Default,,0000,0000,0000,,That's a long time for a strategy
Dialogue: 0,0:17:22.00,0:17:25.00,Default,,0000,0000,0000,,to potentially get changed around -- really, really old.
Dialogue: 0,0:17:25.00,0:17:27.00,Default,,0000,0000,0000,,What do we know about other old strategies like this?
Dialogue: 0,0:17:27.00,0:17:30.00,Default,,0000,0000,0000,,Well, one thing we know is that they tend to be really hard to overcome.
Dialogue: 0,0:17:30.00,0:17:32.00,Default,,0000,0000,0000,,You know, think of our evolutionary predilection
Dialogue: 0,0:17:32.00,0:17:35.00,Default,,0000,0000,0000,,for eating sweet things, fatty things like cheesecake.
Dialogue: 0,0:17:35.00,0:17:37.00,Default,,0000,0000,0000,,You can't just shut that off.
Dialogue: 0,0:17:37.00,0:17:40.00,Default,,0000,0000,0000,,You can't just look at the dessert cart as say, "No, no, no. That looks disgusting to me."
Dialogue: 0,0:17:40.00,0:17:42.00,Default,,0000,0000,0000,,We're just built differently.
Dialogue: 0,0:17:42.00,0:17:44.00,Default,,0000,0000,0000,,We're going to perceive it as a good thing to go after.
Dialogue: 0,0:17:44.00,0:17:46.00,Default,,0000,0000,0000,,My guess is that the same thing is going to be true
Dialogue: 0,0:17:46.00,0:17:48.00,Default,,0000,0000,0000,,when humans are perceiving
Dialogue: 0,0:17:48.00,0:17:50.00,Default,,0000,0000,0000,,different financial decisions.
Dialogue: 0,0:17:50.00,0:17:52.00,Default,,0000,0000,0000,,When you're watching your stocks plummet into the red,
Dialogue: 0,0:17:52.00,0:17:54.00,Default,,0000,0000,0000,,when you're watching your house price go down,
Dialogue: 0,0:17:54.00,0:17:56.00,Default,,0000,0000,0000,,you're not going to be able to see that
Dialogue: 0,0:17:56.00,0:17:58.00,Default,,0000,0000,0000,,in anything but old evolutionary terms.
Dialogue: 0,0:17:58.00,0:18:00.00,Default,,0000,0000,0000,,This means that the biases
Dialogue: 0,0:18:00.00,0:18:02.00,Default,,0000,0000,0000,,that lead investors to do badly,
Dialogue: 0,0:18:02.00,0:18:04.00,Default,,0000,0000,0000,,that lead to the foreclosure crisis
Dialogue: 0,0:18:04.00,0:18:06.00,Default,,0000,0000,0000,,are going to be really hard to overcome.
Dialogue: 0,0:18:06.00,0:18:08.00,Default,,0000,0000,0000,,So that's the bad news. The question is: is there any good news?
Dialogue: 0,0:18:08.00,0:18:10.00,Default,,0000,0000,0000,,I'm supposed to be up here telling you the good news.
Dialogue: 0,0:18:10.00,0:18:12.00,Default,,0000,0000,0000,,Well, the good news, I think,
Dialogue: 0,0:18:12.00,0:18:14.00,Default,,0000,0000,0000,,is what I started with at the beginning of the Talk,
Dialogue: 0,0:18:14.00,0:18:16.00,Default,,0000,0000,0000,,which is that humans are not only smart;
Dialogue: 0,0:18:16.00,0:18:18.00,Default,,0000,0000,0000,,we're really inspirationally smart
Dialogue: 0,0:18:18.00,0:18:21.00,Default,,0000,0000,0000,,to the rest of the animals in the biological kingdom.
Dialogue: 0,0:18:21.00,0:18:24.00,Default,,0000,0000,0000,,We're so good at overcoming our biological limitations --
Dialogue: 0,0:18:24.00,0:18:26.00,Default,,0000,0000,0000,,you know, I flew over here in an airplane.
Dialogue: 0,0:18:26.00,0:18:28.00,Default,,0000,0000,0000,,I didn't have to try to flap my wings.
Dialogue: 0,0:18:28.00,0:18:31.00,Default,,0000,0000,0000,,I'm wearing contact lenses now so that I can see all of you.
Dialogue: 0,0:18:31.00,0:18:34.00,Default,,0000,0000,0000,,I don't have to rely on my own near-sightedness.
Dialogue: 0,0:18:34.00,0:18:36.00,Default,,0000,0000,0000,,We actually have all of these cases
Dialogue: 0,0:18:36.00,0:18:39.00,Default,,0000,0000,0000,,where we overcome our biological limitations
Dialogue: 0,0:18:39.00,0:18:42.00,Default,,0000,0000,0000,,through technology and other means, seemingly pretty easily.
Dialogue: 0,0:18:42.00,0:18:45.00,Default,,0000,0000,0000,,But we have to recognize that we have those limitations.
Dialogue: 0,0:18:45.00,0:18:47.00,Default,,0000,0000,0000,,And here's the rub.
Dialogue: 0,0:18:47.00,0:18:49.00,Default,,0000,0000,0000,,It was Camus who once said that, "Man is the only species
Dialogue: 0,0:18:49.00,0:18:52.00,Default,,0000,0000,0000,,who refuses to be what he really is."
Dialogue: 0,0:18:52.00,0:18:54.00,Default,,0000,0000,0000,,But the irony is that
Dialogue: 0,0:18:54.00,0:18:56.00,Default,,0000,0000,0000,,it might only be in recognizing our limitations
Dialogue: 0,0:18:56.00,0:18:58.00,Default,,0000,0000,0000,,that we can really actually overcome them.
Dialogue: 0,0:18:58.00,0:19:01.00,Default,,0000,0000,0000,,The hope is that you all will think about your limitations,
Dialogue: 0,0:19:01.00,0:19:04.00,Default,,0000,0000,0000,,not necessarily as unovercomable,
Dialogue: 0,0:19:04.00,0:19:06.00,Default,,0000,0000,0000,,but to recognize them, accept them
Dialogue: 0,0:19:06.00,0:19:09.00,Default,,0000,0000,0000,,and then use the world of design to actually figure them out.
Dialogue: 0,0:19:09.00,0:19:12.00,Default,,0000,0000,0000,,That might be the only way that we will really be able
Dialogue: 0,0:19:12.00,0:19:14.00,Default,,0000,0000,0000,,to achieve our own human potential
Dialogue: 0,0:19:14.00,0:19:17.00,Default,,0000,0000,0000,,and really be the noble species we hope to all be.
Dialogue: 0,0:19:17.00,0:19:19.00,Default,,0000,0000,0000,,Thank you.
Dialogue: 0,0:19:19.00,0:19:24.00,Default,,0000,0000,0000,,(Applause)