Greedy Monkeys

Here is a passage from Superfreakonomics describing an Economics experiment conducted with Capuchin Monkeys who were introduced to the concept of money (i.e. something which has no intrinsic consumption value but can be exchanged for goods or services received from others) and their response to a gambling game:

This is a Capuchin Monkey! (Which one?) Guess!

The researcher ( Keith Chen) set up two gambling games. In the first, a capuchin was shown one grape and, dependent on a coin flip, either got only that grape or won a bonus grape as well. In the second game, the capuchin started out seeing two grapes, but if the coin flip went against him, the researchers took away one grape and the monkey got only one.

In both cases, the monkey got the same number of grapes on average. But the first gamble was framed as a potential gain while the second was framed as a potential loss.

How did the capuchins react?

Given that the monkeys aren’t very smart in the first place, you might assume that any gambling strategy was well beyond their capabilities. In that case, you’d expect them to prefer it when a researcher initially offered them two grapes instead of one. But precisely the opposite happened! Once the monkeys figured out that the two-grape researcher sometimes withheld the second grape and that the one-grape researcher sometimes added a bonus grape, the monkeys strongly preferred the one-grape researcher. A rational monkey wouldn’t have cared, but these irrational monkeys suffered from what psychologists call “loss aversion.” They behaved as if the pain from losing aa grape was greater than the pleasure from gaining one.

Up to now (i.e. before conducting this experiment), the monkeys (had) appeared to be as rational as humans in their use of money. But surely this last experiment showed the vast gulf that lay between monkey and man.

Or did it?

The fact is that similar experiments with human beings—day traders for instance—had found the same kind of irrational decisions at a nearly identical rate. The data generated by the capuchin monkeys, Chen says, ‘make them statistically indistinguishable from most stock-market investors.”

So the parallel between human beings and these tiny-brained, food-and-sex monkeys remained intact.