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The behavioral economics of Burning Man

I went to Burning Man for the fourth time this year and had a blast, with the exception of trying to sleep next to a very large sound system that played until dawn several nights. Chris Fitzner (playa name Cocoa Fitzy) has some photographic evidence for those interested in seeing me in my underwear.

Besides the usual panoply of naked hippies, flame effects, and dangerous art pieces to climb on / be trampled by, we were treated to a talk at Center Camp by Dan Ariely — a longer version of this one he gave at TED:

I hate classical economics because it’s entirely predicated on an absurd assumption: that humans behave rationally. I’m a fan of Dan Ariely because he starts with evidence-based inquiries into the only kind of psychology I really grok (behaviorism), then applies them to our economic lives. In case you don’t have time to watch the speech above, he essentially proves that classical economic models of cheating involving risk, punishment, and reward are bogus. The example he gave at Burning Man was that, when driving past a liquor store, you don’t decide whether or not to rob it based on a calculation of the money you’ll make, the risk you’ll be caught, and the punishment that would result. Instead, we’re motivated to cheat or be honest by a complex set of social and cultural cues that can be tweaked experimentally with interesting results.

At Burning Man, he expounded a bit on another set of experiments trying to suss out the effect of money on motivation. He experimented in a college town, trying to get people on the sidewalk to help him move a sofa. When he just asked people to help without any reward, most said yes, motivated (we suppose) by a desire to feel good about themselves. Interestingly, when he offered them a trivial amount of money ($0.50), most would not help. In other words, instead of augmenting the social motivation to help, the money actually replaced it. When he offered a substantial amount ($5), people started agreeing again. More interestingly, money seems unique in this effect on people — when Ariely tempted people with a gift of chocolate, either a cheap piece or an expensive box, they helped; when he told them how much the gift was worth, the results mirrored that of the monetary reward.

The single largest cultural fixture at Burning Man is the absence of money: you can’t buy or sell anything. The sole exceptions are coffee and ice, since those are hard to bring and relatively essential to a week in the desert. (Drugs are of course bought and sold, although they’re just as often gifted.) Burning Man’s “economy” is a gift economy, where social accord is earned through the giving away of wealth, in the form of alcohol or other drugs, an interesting structure you built, an absurd service (psychic taxi, terrible advice), etc. Talks like Ariely’s help us understand why this seemingly simple change of rules produces, in large part, such a profound effect on the culture of the place.

Every year the Burning Man survival guide reminds participants that

Burning Man is an experiment in temporary community. Because many people only know a world shaped by institutions, service workers, and commercial transactions, they may not even recognize the signs of a community. Here are a few of its indicators:

Capacity: Communities are built on the recognition of the unique abilities of every member. Commerce and the public service sector outside of BRC define us on the basis of deficiency and need.

Celebration: Community activities incorporate celebration, parties, and other social events. The line between work and play becomes blurred. The human nature of everyday life becomes part of the way you work. You will know that you are in a community if you often hear laughter and singing.

Collective Effort: Community is cooperative uniting us as varied members of one body. By contrast, when we consume a service, we’re made passive. 50 million people consume a beverage in complete isolation from one another.

Informality: In the community, transactions of value take place without money, advertising, or hype. Care emerges in place of structural service.

Stories: In universities, people know through studies. In businesses and bureaucracies, people know by reports. In communities, people know by stories.

However you feel about these ideals of community, as a four-time attendant I can verify that all these elements are at work in Burning Man. I can’t identify a single one not fouled up by money.

Related: Dan Ariely talks more about irrational decision making:

And Dan Pink debunks more of classical economics, this time with an eye to rewards in the job market.

Posted in Musings.

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  1. J-Biscuit says

    Great post, Z.

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