Incentives can get the animal spirits out - even in the kindest of creatures

By George ILIEV
CorporateNature Metaphor Series, No 74.

Kelly the dolphin was an obedient and fast-learning mammal in a park on the Gulf of Mexico...until it all got out of whack. She was trained to bring pieces of rubbish from her pool and would receive a fish in reward. Then Kelly realised she could manipulate the system. First, as the reward did not depend on the size of the rubbish, Kelly started breaking up large pieces of paper into smaller pieces to get multiple rewards. Then, she figured out something even more sinister: if she used her reward fish as bait, a seagull would get tempted to fly into the water, Kelly would catch it, drown it and hand over the bird's body to get more rewards. Kelly also made sure to teach her child these tricks, who in turn taught other young dolphins.

Does this remind you of investment bankers before the 2008 global financial crisis? Just like Kelly the dolphin, they would chop up sub-prime mortgages into collateralised debt obligations (CDO) and got handsome rewards for doing it.

But who is to blame: the perpetrators, be they animals or humans? Or the human creators of the incentive systems?

Dolphin (Source: Wikipedia)