Turns out "human nature" happens even in monkeys. An economist uses capuchin monkeys to test out economic principles and see how they compare with humans and homo economicus.
The essential idea was to give a monkey a dollar and see what it did with it. The currency Chen settled on was a silver disc, one inch in diameter, with a hole in the middle -- ''kind of like Chinese money,'' he says. It took several months of rudimentary repetition to teach the monkeys that these tokens were valuable as a means of exchange for a treat and would be similarly valuable the next day. Having gained that understanding, a capuchin would then be presented with 12 tokens on a tray and have to decide how many to surrender for, say, Jell-O cubes versus grapes. This first step allowed each capuchin to reveal its preferences and to grasp the concept of budgeting.Interesting how monkeys act just like people, and neither act like text book economic maximizers.
Then Chen introduced price shocks and wealth shocks. If, for instance, the price of Jell-O fell (two cubes instead of one per token), would the capuchin buy more Jell-O and fewer grapes? The capuchins responded rationally to tests like this -- that is, they responded the way most readers of The Times would respond. In economist-speak, the capuchins adhered to the rules of utility maximization and price theory: when the price of something falls, people tend to buy more of it.
Chen next introduced a pair of gambling games and set out to determine which one the monkeys preferred. In the first game, the capuchin was given one grape and, dependent on a coin flip, either retained the original grape or won a bonus grape. In the second game, the capuchin started out owning the bonus grape and, once again dependent on a coin flip, either kept the two grapes or lost one. These two games are in fact the same gamble, with identical odds, but one is framed as a potential win and the other as a potential loss.
How did the capuchins react? They far preferred to take a gamble on the potential gain than the potential loss. This is not what an economics textbook would predict. The laws of economics state that these two gambles, because they represent such small stakes, should be treated equally.
So, does Chen's gambling experiment simply reveal the cognitive limitations of his small-brained subjects? Perhaps not. In similar experiments, it turns out that humans tend to make the same type of irrational decision at a nearly identical rate. Documenting this phenomenon, known as loss aversion, is what helped the psychologist Daniel Kahneman win a Nobel Prize in economics. The data generated by the capuchin monkeys, Chen says, "make them statistically indistinguishable from most stock-market investors."
Something else happened during that chaotic scene, something that convinced Chen of the monkeys' true grasp of money. Perhaps the most distinguishing characteristic of money, after all, is its fungibility, the fact that it can be used to buy not just food but anything. During the chaos in the monkey cage, Chen saw something out of the corner of his eye that he would later try to play down but in his heart of hearts he knew to be true. What he witnessed was probably the first observed exchange of money for sex in the history of monkeykind. (Further proof that the monkeys truly understood money: the monkey who was paid for sex immediately traded the token in for a grape.)World's oldest profession, world's first monkey profession.
This is a sensitive subject. The capuchin lab at Yale has been built and maintained to make the monkeys as comfortable as possible, and especially to allow them to carry on in a natural state. The introduction of money was tricky enough; it wouldn't reflect well on anyone involved if the money turned the lab into a brothel. To this end, Chen has taken steps to ensure that future monkey sex at Yale occurs as nature intended it.
Via Monkey Business - New York Times