How, in an unequal world, can we hope to transform business to once again foster the values most of us share? We will argue in Chapter 9 that to uphold and prioritize a social contract above shareholder value requires the development of all forms of economic democracy. Employee-owned companies, co-operatives, employee share-ownership schemes, strong trade unions and employee representation all help to curb runaway top incomes and the bonus culture. But economic democracy can also act as a curb to the excesses and ruthlessness of narcissistic and psychopathic business ‘leaders’, constraining their freedom to manipulate and bully, take too many risks, and cover up mistakes. It’s possible for business leaders accountable to employees to achieve status by combining positive dominance strategies with warmth, so sitting in the lower right-hand side of our Figure 2.4 – using their skills and expertise for alliance-building and co-operation, demonstrating true leadership through persuasion and conscientiousness, inspiring rather than intimidating people, and taking authentic pride in creating and growing businesses that serve, rather than exploit, people and society.
THE RICH REALLY ARE DIFFERENT … INEQUALITY AND SENSE OF ENTITLEMENT
Most people aren’t narcissists, even if there is suggestive evidence that there is a rise in narcissism caused by inequality, and only a very tiny proportion are psychopaths, even though such people cause disproportionate amounts of emotional and criminal damage at the top and bottom of society. But narcissism and psychopathy are the tip of the iceberg. There is huge damage to society from people simply feeling that their superior position makes them more deserving than others.
Paul Piff, a social psychologist at the University of California, Berkeley, has carried out a remarkable set of experiments focused on social hierarchy, emotions, relationships between social groups and what psychologists call ‘prosocial’ behaviour – that is, actions that benefit others or society as a whole, such as sharing, volunteering, co-operating and helping others.
In the first set of experiments, Piff and his colleagues looked at the prosocial behaviour of people in ‘lower social classes’ – defined as people whose life circumstances (with less education, less money, lower rank and more of the problems related to deprivation, including stressful family relationships) typically lead to a low sense of personal control.143 They wanted to know if, despite (or perhaps because of) their social position, people in this group are more concerned with the needs of others and more willing to help others than people with higher incomes, more education, etc. They already knew that, in America, poorer households give a larger proportion of their income to charity than richer households (perhaps a reflection of their own experience of having to rely on social bonds and networks to get by).144 In experimental conditions in which they took account of age, ethnicity and religious tendencies, the researchers found that, in economic games, people in the lower class group allocated more money to a partner, were more trusting, believed that a higher proportion of a family’s income should be donated to charity, and were more helpful to a partner in a controlled situation set up to make them believe that the partner was in distress.
Not only were people in the lower social class group more prosocial, they were also more ethical. In a second set of tests, Piff and his colleagues again used laboratory experiments and observational studies of car drivers at an intersection and a pedestrian crossing.145 They found that drivers of higher status (more expensive) vehicles (based on make, age and appearance) were more likely to cut in front of other drivers instead of waiting their turn, and less likely to yield to pedestrians waiting to cross the road (Figure 3.3).
Piff also looked at a sense of entitlement among upper- and lower-class subjects.146 The upper-class group scored higher than lower-class subjects on psychological measures of entitlement (sample question: ‘I honestly feel I’m just more deserving than others’), on the Narcissistic Personality Inventory, and were more likely to spend time looking at themselves in a mirror when they were left alone and thought they were unobserved.
In controlled experiments, after reading scenarios in which characters took something or benefitted from something they were not entitled to, those in the upper-class group were more likely than people in the lower-class group to say that they would do the same. Although this might simply have indicated that the upper-class group cared less about what the researchers thought of them, they were more likely to actually deceive others in a scenario where they could choose to withhold the truth from an imaginary job applicant. They were also more likely to cheat in a dice game. And they were more likely to take sweets that they had been told were intended for children in a nearby laboratory.146
Figure 3.3: Percentage of cars that cut off other vehicles at an intersection and pedestrians at a crossing, by vehicle status.145
Piff’s research suggests that we can change people’s tendency to behave in unethical, antisocial, narcissistic ways by appealing to their better nature. When subjects were primed to think about the statement ‘greed is good’ by having to write down three benefits of equality, differences in unethical behaviour between the upper- and lower-class groups disappeared. The researchers concluded that the groups didn’t differ in their capacity for unethical behaviour, but did differ in their general default tendencies towards it. And the researchers similarly were able to reduce the upper-class subjects’ narcissism by getting them to think about egalitarian values. The subjects were split into two groups before completing the Narcissistic Personality Inventory. One group (‘Egalitarian’) was asked to write down three benefits of treating other people as equals; the other group (‘Control’) simply wrote down three activities they did on a typical day. In the control group, there was the expected excess of narcissism among upper-class individuals, but in the group who had been asked to think about egalitarian values, the narcissism of the upper-class individuals was significantly reduced (Figure 3.4).
There are two plausible explanations of Piff’s finding that higher-status people appear to behave worse towards others. One is that people who are more strongly motivated to maximize their own status may also, by nature and temperament, be more antisocial. The other is that we might all behave badly to those below us on the social ladder; high-status people might then differ only in seeing more of us as their inferiors.
The real explanation, though, seems to be that it is inequality itself that creates the climate in which richer, higher-status people behave badly, rather than some inbuilt characteristic. Piff’s observations and experiments were all conducted in the USA. It now looks as if the tendency for better-off people to behave in more antisocial ways is not found in more equal societies. Researchers have found that in the Netherlands, Germany and Japan, all much more equal than the United States, richer people are no less likely than poorer people to be trusting or generous.147 Further evidence from that 2015 study found a tendency for higher-income individuals in the United States to be less generous only in more unequal states.147 Researchers used a nationally representative survey that gave participants an opportunity to donate to others, and found that in the most unequal US states, higher-income people were less generous than those with lower incomes, whereas in the least unequal states, higher-income individuals were more generous. They also set up an experiment in which levels of economic inequality in participants’ home states were described as either relatively high or low. In this case, higher-income people were less generous than lower-income people if they had been told they lived in a more unequal place, but not when they were told they lived in a more equal place.
Figure 3.4: The higher narcissism scores of upper-social-class people are reduced when they are primed to think about egalitarian values.146
NARCISSISM TRUMPS GOOD LEADERSHIP
Perhaps none of this would matter if higher-status individuals in more unequal societies were effective leaders, despite being less trusting, less generous, etc. When we started writing this book, we had no idea that someone with pronounced narcissistic tendencies could be elected
to the highest political office, but the leadership qualities of President Trump are now a matter of great concern throughout the world. It is impossible to diagnose someone solely though their pronouncements on social media, but Donald Trump’s incessant tweeting suggests self-grandiosity, callousness, poor sense of control and many of the other characteristics of narcissists and psychopaths. A few examples of his Tweets include:
– ‘I understand things. I comprehend very well, better than I think almost anybody.’
– ‘I understand the tax laws better than almost anyone.’
– ‘I know more about renewables than any human being on Earth.’
– ‘Nobody knows banking better than I do.’
– ‘Nobody in the history of this country has ever known so much about infrastructure as Donald Trump.’
– ‘There’s nobody bigger or better at the military than I am.’
And perhaps most amusingly (or sadly):
– ‘The new Pope is a humble man, very much like me.’
Narcissists tend to be regarded as effective leaders on short acquaintance, probably because we value the confidence they exude. However, in the longer-term narcissists become increasingly unpopular, as their arrogance and aggressiveness come to the fore.148, 149
In the study of active US soldiers that we referred to earlier in this chapter, coming from a richer family was linked to a higher risk of narcissism, and the researchers also found that this link led to less effective leadership.124 If, as many have suggested, income inequality has exacerbated the social divisions that underpin the present rise of populism, it can also throw up leaders with such a sense of entitlement and narcissistic self-belief that they cannot lead effectively, or with humility and compassion.
EMPATHY: HOW SOCIETIES MIND THE GAP
Just as important as the impact of inequality on narcissism, psychopathy and a sense of entitlement, are the effects on empathy. Understanding and sympathizing with each other’s feelings underpins community life and social relationships. It’s not just an important human quality; many social animals exhibit empathy, for it is what allows them to maintain relationships within social groups. Among our nearest animal relatives, monkeys and apes show attachment to one another and share emotions, becoming excited when other members of the group are excited, or comforting another animal that appears frightened or sad. Primatologist Frans de Waal cites examples of chimpanzees and bonobos throwing a chain to another animal stuck in a zoo moat, or bringing water to an animal unable to obtain it for itself.150 Empathy is key to survival because co-operation is so essential.151
Empathy in individuals, including children, can be destroyed by neglect or abuse. Mary Clark, an expert on conflict resolution, calls the compassion that arises from empathy the primary characteristic of humans.151 Loss of empathy, what psychiatrist Simon Baron-Cohen calls ‘turning people into objects’, puts us into ‘I mode’ and this lack of empathy underpins cruelty.152 Baron-Cohen’s book Zero Degrees of Empathy gives examples of individuals acting without empathy from many different cultures, and examples of gratuitous cruelty. He defines empathy as occurring when ‘we suspend our single-minded focus of attention, and instead adopt a double-minded focus of attention’, which allows us to ‘identify what someone else is thinking or feeling, and to respond … with an appropriate emotion’. As inequality renders whole societies less empathetic, we are less able to bridge the widening differences and social distances between groups; we increasingly lose any sense of being in this together and of the necessity of protecting the most vulnerable and the voiceless.
Susan Fiske, a psychologist at Princeton University, describes how psychological experiments that induce people to feel powerful also cause deficits in their ability to understand others’ emotions and thoughts, because powerful or dominant people can ignore others with impunity.153 As she says, ‘power may allow scorn’, and, as she also shows, scorn is harmful to both the scorned and the scorner, creating barriers to shared experiences. She calls scorn a moral hazard of high status, causing everything from casual thoughtless disregard to the dehumanization of those who are scorned. Envy of others, the flip-side of scorn, is also corrosive for both the envier and the envied; enviers feel shame, resentment, anger; the envied are perceived as cold, calculating and threatening.
Beyond the personal experiences which shape our own empathy and compassion, does inequality shape our collective, societal empathy? As we have already described, income inequality increases the social distances between us and heightens the salience of status and competition for status. In the very first two sentences of her book Envy Up, Scorn Down, Fiske says: ‘we are divided by envy and scorn, brought on by the status concerns that pervade our society. Income inequality, now at historically high levels, aggravates these status divides.’153 Until very recently, however, there was no real evidence that empathy is affected by different levels of income inequality. Two studies, both published in 2012, now go some way to addressing that.
The first, from psychologist Federica Durante of the University of Milan and her colleagues, was a global study across thirty-seven countries of the ways in which people stereotype ‘others’.154 The researchers wanted to understand how, given the extensive problems it causes, populations don’t actively oppose inequality, and instead acquiesce in the maintenance of the status quo. They suggest that being able to view ‘other’ groups in ambivalent ways – allowing those groups to have both good and bad characteristics – might be a way in which people are able to rationalize inequality. For example, if we felt all rich people were selfish and mean, we might not tolerate the inequality that allows people to become very rich; but if we believe the rich are especially capable and do good things for the economy, then we would tolerate their existence.
We all, to some degree, hold stereotypes about ‘others’, and view different groups as having different strengths and weaknesses. Some of the characteristics by which we stereotype groups of people include whether or not we believe they are of high or low status, more or less competent, competitive or collaborative, warm and friendly as opposed to cold and hostile, etc. Durante and her colleagues hypothesized that holding ambiguous stereotypes about others, for example holding the paternalistic view that women are warm but incompetent, or that the rich are competent but cold and calculating, would be more common in more unequal countries. This was borne out by their findings: in more unequal societies people tended to view others more ambivalently. As income inequality increases, so does the need to justify and rationalize it, to think that the rich contribute something good, even if they are selfish, or that the poor are kind to one another, even if they have failed to get on in life – otherwise the whole social structure would feel unjust and intolerable. We rationalize inequality by seeing different groups as more or less deserving or moral. As the authors say, ‘the more income inequality, the more social groups need to be rewarded’. Inequality changes the way people think about others.
Do such stereotypes matter? After all, the study simply measured how people think about others (in fact, how they think other people think about others), rather than how they act, and indeed interact, with other people. Surely the truer sign of empathy is how people actually behave towards one another, their willingness to act compassionately rather than coldly, collectively rather than competitively?
In Chapter 2, we mentioned a study by social scientists Marii Paskov and Caroline Dewilde, who used data from the European Values Survey to look at income inequality and solidarity.39 They defined ‘solidarity’ as people’s willingness to contribute to the welfare of others, an important aspect of empathy. People in twenty-six European countries were asked: ‘Would you be prepared to actually do something to improve the conditions of: (a) people in your neighbourhood/community; (b) elderly in your country; (c) sick and disabled people in your country; (d) immigrants in your country?’ The analysis controlled for each country’s average income, spending on social protection and type of welfare regime, and for e
ach respondent’s gender, age, marital and employment status, whether they were an immigrant or religious, as well as their education and income.
Taking all these things into account, the researchers found a significant tendency for people in more equal countries to be more willing to help others. The strongest reasons given for helping others were moral duty and sympathy, rather than the general interest of society or self-interest. People were much more willing to help the sick, disabled and older people, and less willing to help immigrants, but the differences between countries were substantial. In Sweden, 85% of people were willing to help the elderly, compared to only 54% in Great Britain, and 33% in Estonia; 68% of Swedes would help immigrants, whereas only 14% of British people and 4% of Lithuanians were willing to do so. The effects of inequality on social cohesion, segregation and trust are well known1, 155; many separate studies have shown that increased inequality erodes trust. What Paskov and Dewilde have shown is how levels of trust and social cohesion might translate into actual solidarity and neighbourliness: regardless of their own income level, people in more unequal countries were less willing to help others.
In this chapter, we’ve traced the evidence that shows how inequality pressures people to feel a greater need to present themselves as better than others; how a modern epidemic of narcissism reflects growing inequality; how business has paved the way for people with psychopathic tendencies to rise to the top of the corporate world; and how people are more anxious about their status in more unequal countries. We’ve seen how the rich can be encouraged to be less antisocial, more ethical, and feel less entitled when they are asked to think about egalitarian values. And we’ve seen evidence that empathy and willingness to help others is eroded by income inequality.
The Inner Level Page 10