In a recent interview with Paul Solman, behavioral economist Dan Ariely asserted that financial cheating might result when people deal in abstract vehicles rather than tangible cash. His experiments even show that “New York bankers are the only group that cheats more, much more, by about twice as much”. A possible root cause: the abstract nature of financial instruments with which bankers deal. Ariely then suggested that for a bank to succeed in the future might depend upon maintaining transparent relationships with its customers.

Leading to our financial crisis, the securitization of loans raised a similar abstraction layer between borrowers and lenders. In his experiments, Dan might consider studying the degree to which a borrower tends to obscure her genuine capacity to repay debt.