Predictably Irrational, basic human motivations: Dan Ariely at TEDxMidwest

Best-selling author and behavioral economics professor Dan Ariely delves into the essence of human motivation. His clever yet brilliantly simple experiments uncover universal truths about human irrationality and increasing motivation.

OK, so I want to talk today
a little about human motivation.

What gets us to care
and act, and be active.

And the starting point,

especially being in Chicago,
close to the University of Chicago,

in the Economics Department of Chicago.

I think it is worthwhile to think that
our basic idea about human motivation

is that we think about people like rats.

People don't like to work.

If we were left to our own accord
what we would be doing,

we would be on a beach
somewhere sipping mojitos...

And the ony reason we work
is because we need to get money,

so that we can eventually sit
on the beach drinking mojitos.

(Laughter)

But the basic motivation
is to enjoy leisure and not work

and everything else is just a distraction
in order so we can do that.

And it is a fine model,
but we should ask ourselves,

is this a correct depiction
of human motivation

is this really what gets us
to act and to do things.

And one challenge you can think
about is mountain climbing.

If you look at people
who have climbed different mountains

and their depictions,
and histories and stories

you would think this is the most
miserable thing in the world.

People are cold, and have frostbite

It's hard to breathe, it's difficult.

I climbed a little peak
in the Himalayas many years ago

and you would think that
you would get to the top,

and sit there and enjoy the view.

No! It's cold,
it's miserable, you're tired.

Just go down as fast as possible
from that point on. (Laughter)

And if you think about this behavior

and say to yourself, here is something
that every moment seems like agony,

it just seems like a punishment

and people go down, and all
they want to do is go up again.

They want to recover first,
but then they want to go up again.

How does this view fit with our notion

of people sitting on the beach drinking mojitos?

It looks like people are either
suckers for punishment.

Right? We want to punish ourselves.

Or, that what really motivates us
is not relaxation,

it's not comfort,
it's other things.

It's about achievement,
it's about conquering,

it's about pursuing some goal,
it's about arriving at some peak.

I actually became interested in this topic

when one of my ex-students came to talk to me.

His name was David,
he left university a few years earlier

and he became a consultant,
or some banker on Wall Street.

And he worked for a big bank

and he told me that for a few weeks
he worked on a big presentation

for a merger that was going to happen.

He worked evenings, he worked overtime
to create this beautiful presentation

with statistics and graph
and description.

He was really proud of his work,
and he really enjoyed it.

And then he sent it to his boss,
and his boss said,

"David, great job,
the merger is cancelled."

And he was just devastated!

And the interesting thing about this

is that he said that from a functional
perspective everything was great.

Here he was, he did a good job,
he enjoyed it while he was doing it,

his boss appreciated it,
and he was certain

that he would get
a raise when the time came

but at the same time
he couldn't care now.

And he was working on another document now,
and just couldn't care to the same degree.

Now the question is,
what happened to him? What is it?

Everything functional was OK,
but something was missing.

So to look at this I decided to do
a couple of little experiments.

And the experiments we started with
were about building Bionicles.

So, Bionicles are little Lego robots,
with about forty pieces,

and you're going to build them.

And we got people to come
to the Student Center

and we said, "Hey, why don't you
build Legos for money?"

You want to build the first one?
You can get three dollars for it.

After they finished the first one we asked,
"Do you want to build another one?"

"This one you can get $2.70 for.

When you've finished this one,
do you want another one, for $2.40?"

$2.10

$1.80

And so on at a a diminishing pay rate.

And people basically had
to decide when they want to stop.

At what time, the money
they were getting

from building Legos
was not worth their time.

And we did this in one of two conditions.

The first one was just the way
I described to you now.

People build one Lego after another,
after another, after another

and when they finished
building all these Legos

when they finished
building each of them,

we took them,
we put them under the desk

and we told them that when
they finished the whole experiment

we would take them,
we would break them back,

and we would put them back
in the boxes for the next participant.

This is what we call
the 'meaningful' condition.

Not a really big meaning, we are academics,
but little meaning. (Laughter)

The second experiment,
we called the Sisyphic condition.

And in this experiment people
started building one Lego

and when they finished it
we took it back from them

and said: "Do you want
to build another one?"

And if they wanted to build another one
we handed them the second one,

but as they were working on the second one,

we were taking apart the first one
in front of their eyes.

And then if they wanted to build a third one,
we would give them that one back

So it was a complete recycling.

And we called this the Sisyphic
condition, after Sisyphus,

who pushed the same rock over
the same hill over and over.

And we can ask ourselves
how much of the demotivating

aspects of Sisyphus come from the fact

that he pushed the same rock on the same hill

versus if it was a different hill every time.

So building something,
having it destroyed

in front of your eyes
and building it again

seems kind of an essential element
for being unmotivated

and here is what we got.

In a meaningful condition people
build about eleven robots

and in the Sisyphus condition
they build seven.

We also asked other people
who did not participate

in the experiment to predict
what would people do.

How much more would people build in a 'meaningful'
condition than in a 'Sisyphic' condition.

And people predicted correctly
but dramatically underestimated the effect.

People thought that the difference
would be about one robot

but the difference
was much, much larger.

So we all understand
that meaning is important

we just dramatically underestimate
how important this is.

And I will tell you that I recently went
to give a talk at a big software company.

And this was a company
where a group of people

worked for two years designing
a particular product,

and they thought this was
the best product for this company.

And after two years of working on it,

the week before I came,
the CEO cancelled he project

and I've never seen a group of more
demotivated people in my life.

And they all told me they felt like
they were part of this Lego experiment.

They worked for a long time and something
was just destroyed in front of them.

And I think basically their boss had
the same mistake as our prediction experiment

where he understood that meaning
is probably a little bit important,

but just didn't understand how big it is

and now he had a group of people
who were completely demotivated, and so on.

Now, there was another interesting
part of this experiment

which is if you look
at the correlation between

how much people love Legos naturally
and how much they persisted,

you would expect that people
who love Lego would build a lot

and people who don't love Lego
would build a little;

there would be some individual difference.

And indeed there [were] individual differences

In a meaningful condition people
who loved Legos built more

and people who didn't love them
didn't build as many.

In the Sisyphic condition
the correlation was zero,

which tells me that we basically
choked every inch of enjoyment

people had naturally from Legos.

People come with a natural appreciation
for Legos, some people,

and we were basically able
to crush that...

(Laughter)

So, the next experiment
we wanted to find out

what even smaller differences could make.

So we gave people a sheet of paper
with a lot of letters on it and we said,

"Look for two letters next
to each other that are the same,"

it was a random set
and we did the same thing.

We paid them more for the first sheet,
less for the next sheet, and so on.

And we had three conditions.

In the first condition, every time
you gave me a sheet, if I was the experimenter,

I would ask you to write your name
on the top, I would look at it like this.

I would say "Aha!" and
I would put it on the pile.

In the next condition you didn't have
to write your name.

I would just take the sheet of paper and,
without looking at it,

I would just put it
on the big pile of paper;

no acknowledgement,
just putting it down.

In the third condition,
if you gave me a sheet of paper,

I immediately took it
and shredded it. (Laughter)

And now the question is how much
would people work in those three conditions.

And what I'm going to show you here
is what is the minimum

amount of money people
are willing to work for, right?

How long did it go, so low amounts
of money mean that people enjoy it more.

So we got the replication
on the first result.

In the acknowledged condition
when you say,

"Aha!" people were willing
to work up to $0.15 per page

really low wages.

In the shredded condition
they wanted twice as much money

and the question is, what happens
in the ignored condition?

Is the ignored condition like the shredded?

Is it like the acknowledged?
Is it somewhere in the middle?

It turns out it was very similar
to the shredded condition.

So if you really want to demotivate
people shredding their work

is really good for that.
(Laughter)

But it turns out that
simply ignoring them

gets you a big part of the way,
in fact, almost... (Laughter)

So this was one part of motivation,

it's about feeling meaning
for what you are doing

and acknowledged and so on,
and we mostly did this

by destroying people's motivation.

Let's think for a second
about the other part,

that is how we can get people
to be more motivated.

How we can get people to do more

and, the idea came to me
here after going to IKEA

so I don't know about you, but I like IKEA
but every time I get this furniture,

I find myself that it takes me much longer
than I expected to build this

and the instructions seem confusing.

I often do a step and then have to backtrack

and when I have to guess something I think
I guess wrong more than 50% of the time.

Lots of these things,
and the thought is:

Is it that a result of this?
Do I love my furniture more?

The fact that I have to build them,
that I create them,

does that create a particular attachment
between me and my furniture?

I call this the IKEA effect

And some evidence for this
exists from cake mixes.

So when cake mixes came up in the fifties

to the surprise of the people
who made up the cake mixes

they were not very popular

and the question is, why?

Pie crusts were popular,
cookies were popular

all kinds of other ready mixes
were popular, but not cakes.

And one of the theories was maybe people
didn't have to do much for these cakes

maybe if you take a mix and add some water

put it in the oven and then make it

and someone says, "What a great cake!,"
you just can't feel good about it.

Maybe it was the fact
that it didn't require

as much work that made
cake mixes not as appealing.

This was known as the 'egg theory.'

And what they did to test it was,
they took the eggs out of the cake mix.

All of a sudden the cake mix was the same,

you just had to add eggs
and some milk to it.

What happened now? Cake mixes
became much more popular.

Somehow having to put work into
something makes it more appealing.

We decided to try this out,

so we gave people instructions to do origami

on the top you have the --

(Laughter)

-- on the top you have a list
of what all the signs mean

and then you have a list of instruction
of how to do origami

that is not that easy to do

and we asked people to do it.

And what happened?
People created stuff

that didn't really look like
what it was supposed to,

these were not origami experts.

But if you looked at how much
people valued the origami

there were some auctions and people
could bid for it, and so on.

It turns out that people
who did not build the origami

thought it wasn't that exciting,

and people who built the origami
thought it was just fantastic.

People who built the origami
thought it was great.

But, moreover,
people who built the origami

when we asked them to predict how much
the other people valued this origami

they thought they would value them
as much as they did.

So what happened is that
the people who build the origami

not only thought it was wonderful,

they also thought that other people
would view it their way.

Now we had another condition
that was again going back to IKEA

we had people who got easy instructions

and for some people we hid the top part

so they didn't really have
the rules for how this works out

and unsurprisingly they
built even worse origamis

they were much uglier.
(Laughter)

What happened to the evaluations?

People who built it thought it was better
than people who just evaluated it,

but people who got the hard
instructions liked them even more

all of a sudden they put more into it,
it was more difficult, more challenging

they loved it more.

And what about the people
who evaluated it?

They loved it even less because it was
objectively uglier. (Laughter)

I think we can think about
a good metaphor for this as kids.

These are my kids by the way.

And imagine that I asked you,
"How much would you sell me your kids for?"

Imagine I could erase your memories

and your thoughts and your
emotions about your kids,

how much money would I need
to give you to compensate you for that?

Most people on good days would say
lots and lots of money.

Or imagine that you didn't have kids
and you came to some playground

and you met some kids and you played
with them for a few hours

and after a few hours
you knew a lot about them

and as you said goodbye
the parents of the kids said,

"By the way, they're for sale
if you're interested." (Laughter)

How much would you pay?

And most of us would realize
that not that much

because the fact is -- (Laughter)

-- the fact is we value our kids
largely because they're ours.

And a little bit like the
IKEA furniture it's because

they're ours and we put
so much effort into them

and because it's hard
and complex and difficult,

instructions are not clear,
and so on. (Laughter)

So, what I want to propose is that

you know we have this incredibly
simple model of labor --

motivation is payment,
that's basically it

and if you think about what
we do in the workplace

it's basically the model we use.

But this is not the right model

in fact if you think about anything
that you see in the world,

it's very hard to think that this model
is a good description of human behavior.

It doesn't describe zero,
but it definitely

is not a really good
description of what happens.

In reality we have lots of other things

we have meaning, the feeling of creation,
challenges, and so on and so forth.

And unless we understand
those different elements

I don't think we could
create the right environment.

Now just this one side comment,
we can take money

and we can make it
fulfill other motivations.

For example, we can get pride,
and get people

to be proud of how much money they get.

We can get accomplishment,
we can get competition

money can be a substitute
for all of those other motivations

but it doesn't mean it's inherently
about all of those motivations.

Human beings are complex,
and have lots of things that we strive for

like in mountain climbings,

and reducing all of it
to just what salary we're getting

is just not the right model.

And finally, I wanted
to tell you something

about Adam Smith versus Karl Marx.

Adam Smith has this notion
about efficiency in the workplace.

The notion was, if you take
for example the creation of a pin

in the old days, and you say:
What's the efficient way to create a pin?

He says if one person creates all the steps
to make a pin, it's incredibly inefficient

but if you get twelve people, and each
of them makes one step of creating a pin,

all of a sudden, together,
there's a huge efficiency in production

and the output from the factory
can be dramatically higher.

And that was the notion
of efficiency and productivity.

Karl Marx, on the other hand,
had this notion about the alienation of labor;

how connected do you feel from it.

And if you take the creation
of a pin, and you make it

into twelve steps,
and each person does one step

how connected do people feel,
if they're doing the same thing all the time

all day, they never see the progression

or creation of the final product
of what they are doing.

And I think that in the preindustrial age
Adam Smith was right;

you could get more value
out of increased efficiency

than you can get from
the alienation of work.

But we are not in that age, we are now
in some kind of knowledge economy

for lots of things that we care about.

And I think that in the knowledge economy
things actually have reversed.

If you say, "Let's take a task, programming,
creating a computer, whatever it is...

and break it into lots of little tasks
to make everything much more efficient."

Maybe we'd get more efficiency
in the Adam Smith kind of world

but would we get the same kind of improving,
caring, motivation and meaning?

And perhaps what we are doing
is just doing the wrong approach

and we take big tasks
and try to divide them

into lots of things,
we are actually hurting ourselves.

So, I think that now things
are actually reversed.

And just as a final comment,

I think we can do lots of things
to get people to motivate.

I think we can do things to get people
to motivate and to do much more

but at least, I think,
we should try to not replicate

the Lego experiment in day to day life.

At least, we should try
to not decrease people's motivation

which is something I feel
we are doing way too often.

Thank you very much!

(Applause)