Do individuals successfully cover up their lies? Evidence from a compliance experiment

We study how well individuals in a face-to-face situation can delude others. We exploit data from a laboratory experiment in which participants were asked to assess video-taped statements as being rather truthful or untruthful. The statements are face-to-face tax declarations. The video clips feature each subject twice making the same declaration: One time the subject is reporting honestly, and the other time willingly dishonestly. This allows us to investigate within-subject differences in perceived truthfulness. Our study provides several novel insights. We find that individuals can cover up their lies successfully. On average, a subject is perceived as more truthful if she deceives than if she reports honestly. In particular, individuals with a genuine dishonest appearance manage to increase their perceived truthfulness by up to 14 percent when lying. Moreover, our results show that a subject appears less truthful if she had previously been caught lying. Being detected as a liar previously appears to impair self-confidence and to thereby lower an individual’s ability to deceive.