More Freakonomics

Yale researchers teach monkeys to use money for food.  Ahh, but in a plot twist, the world's oldest profession emerges.

Monkey Business

By STEPHEN J. DUBNER and STEVEN D. LEVITT

Keith Chen's Monkey Research

Adam Smith, the founder of classical economics, was certain that humankind's knack for monetary exchange belonged to humankind alone. ''Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog,'' he wrote. ''Nobody ever saw one animal by its gestures and natural cries signify to another, this is mine, that yours; I am willing to give this for that.'' But in a clean and spacious laboratory at Yale-New Haven Hospital, seven capuchin monkeys have been taught to use money, and a comparison of capuchin behavior and human behavior will either surprise you very much or not at all, depending on your view of humans.

...

It is sometimes unclear, even to Chen himself, exactly what he is working on. When he and Santos, his psychologist collaborator, began to teach the Yale capuchins to use money, he had no pressing research theme. 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.

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.''

ut do the capuchins actually understand money? Or is Chen simply exploiting their endless appetites to make them perform neat tricks?

Several facts suggest the former. During a recent capuchin experiment that used cucumbers as treats, a research assistant happened to slice the cucumber into discs instead of cubes, as was typical. One capuchin picked up a slice, started to eat it and then ran over to a researcher to see if he could ''buy'' something sweeter with it. To the capuchin, a round slice of cucumber bore enough resemblance to Chen's silver tokens to seem like another piece of currency.

Then there is the stealing. Santos has observed that the monkeys never deliberately save any money, but they do sometimes purloin a token or two during an experiment. All seven monkeys live in a communal main chamber of about 750 cubic feet. For experiments, one capuchin at a time is let into a smaller testing chamber next door. Once, a capuchin in the testing chamber picked up an entire tray of tokens, flung them into the main chamber and then scurried in after them -- a combination jailbreak and bank heist -- which led to a chaotic scene in which the human researchers had to rush into the main chamber and offer food bribes for the tokens, a reinforcement that in effect encouraged more stealing.

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.)

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.

But these facts remain: When taught to use money, a group of capuchin monkeys responded quite rationally to simple incentives; responded irrationally to risky gambles; failed to save; stole when they could; used money for food and, on occasion, sex. In other words, they behaved a good bit like the creature that most of Chen's more traditional colleagues study: Homo sapiens.

Stephen J. Dubner and Steven D. Levitt are the authors of ''Freakonomics: A Rogue Economist Explores the Hidden Side of Everything.''

 

Comments

[Paul Zrimsek]

Another example of what Adam Smith almost called "the propensity to ***k and barter".

[BumperStickerist]

~ 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. ~

Nature intended monkey sex to take place in a Yale lab?

[dsquared]

As a diehard Keynesian I would have to point out that this is simply a pure-exchange economy. These tokens are not used as a store of value or a hedge against uncertainty and thus the capuchin monkeys cannot be considered to have discovered "money". Wake me up when monkeys learn to differentiate between liquid and illiquid financial instruments.

[Crank]

Chen has taken steps to ensure that future monkey sex at Yale occurs as nature intended it.

Theocracy! Someone call Andrew Sullivan!

[Crank]

BTW, you realize what kind of Google hits this story will get you.

[quasimodo]

I remember a story like this from a college psychology text from the early 70's....only the oldest profession arose spontaneously. The female monkeys traded favors for a handful of raisins. The researchers could not figure out why the male monkeys were saving their rewards (raisins) from the experiments. Late one night a researcher returned to the lab unexpectedly and witnessed the "exchange." badmonkey

[Huggy]

Without the sex this story wouldn't get much coverage. Corner of the eye anecdote doesn't really cut it.

A Science Priest wouldn't make stuff up to maybe get positive media coverage...naw wouldn't ever happen.

I would provide a proof of this but the margins are too narrow to contain it...

[Cecil Turner]

"badmonkey"

Needs a spanking.

On a related note, the bia*ch monkey who rapidly converted her trick money for a grape was later seen being slapped by a capuchin in a purple panama hat, leather vest, and a fuzzy green . . .

[The Kid]

Er, this may shed some light on a question posed by the late, great Frank Zappa as he wondered aloud about how simian immunodeficiency virus (SIV) became human immunodeficiency virus (HIV): So who's Plunkin' the monkeys?

[Birkel]

"diehard Keynesian"

???

I mean... What? Do you just go around citing the longer and deeper recessions that theory helped cause? Do you just overlook the differential growth rates of countries that employ Keynesian theories versus Chicago School theories? Goodness me but it really does take all kinds.

[dsquared]

I am unlikely to engage in an argument with someone who talks about "countries that employ Keynesian theories versus Chicago School theories", but this does not constitute acquiescence.

[BumperStickerist]

~ Wake me up when monkeys learn to differentiate between liquid and illiquid financial instruments. ~

I think the monkeys have learned to differentiate between the two, they fling the illiquid ones.

[Digger]

Argh...sorry about the multiple trackbacks. Stupid Movabletype.

[Birkel]

dsquare,

Yes, yes. You're much brighter than I am.

Not that I'm likely to acquiescence on that point.

BTW,
America moved from Keynesian economics to Chicago School economics circa the late 1970's. No?

[Megan]

"Wake me up when monkeys learn to differentiate between liquid and illiquid financial instruments."

I guess humans would have to learn that first

no, just kidding (I think)

good point :)