Back of the Envelope Economics of Cheating

 

There are lots of complex, interrelated reasons why people cheat on their partner. And I’m aware that this might be a sensitive subject for some, so here I make no comment about the whys and wherefores, nor any general moral comments, nor any invitations to accuse or find fault. I also acknowledge the numerous emotional, psychological and social factors involved in cheating, that are beyond the intention of this short post.

But with the foregoing acknowledgements, given that most things can be amenable to an economic analysis, in some sense cheating can be thought of in economic terms too in terms of perceived costs and incentives.

Suppose we hypothetically assign a value to relationships in terms of their overall quality (that’s a complex measurement in itself, but we can simply do so to illustrate). Take two couples; Jack and Jill, and Bob and Tracy. Jack and Jill are happily married, they own a home together, have 2 children, are actively involved in their church and community, and have been together for 15 years. Bob and Tracy have been dating for a year, they are unmarried, in a relationship, with no children, and they live in separate dwellings. 

Let’s say, for simplicity, we value Jack and Jill’s relationship at £500,000, and Bob and Tracy’s at £35,000. At first glance, it looks like the cost of cheating in Jack and Jill’s relationship is greater than in Bob and Tracy’s. Let’s illustrate with a simple calculation. Say in both cases the probability of getting caught is 20%, and the probability that the relationship will break down is 80%. Suppose saucy Sally is messaging both Jack and Bob, trying to entice one of them to a hotel room for a sexual encounter.

The cost of cheating for Jack is:

0.20 x 0.80 x £500,000 = £80,000

The cost of cheating for Bob is:

0.20 x 0.80 x £35,000 = £5,600

In this example, the cost of cheating for Jack is significantly higher than for Bob, due to the higher value assigned to Jack and Jill’s relationship. When people get caught up in the possibility of cheating, their mind undergoes a complex set of cost-benefit analyses, based on the approximate value assigned to the relationship, and the expected cost of cheating, and getting caught. Of course, the cost of cheating, and the cost of getting caught, are distinct but with overlap, because there is a cost of cheating even if you don’t get caught. Assigning a higher value to the relationship generally makes the cost of cheating more substantial, potentially deterring infidelity due to higher perceived risks – although humans are far from wholly rational calculators, and are prone to regrettable actions even when the costs are high and the benefits relatively low. What this does show, however, is that there are varying perceptions of relationship value and risk that influence behaviour, and cheating and potential cheating fall under this calculus too.

Relationships thrive not just on calculated gains, but on the investments we make in increasing their value through longer term commitment, trust, respect, and mutual understanding. There is certainly a general sense in which the higher the value of the relationship, the lower the likelihood of infidelity (there are always exceptions, of course) – and the corollary is that cheating is more likely to occur in relationships where there are issues and incompatibilities that have not been sufficiently addressed.