

Zak's work on oxytocin, which Genome author Matt Ridley calls "one of the most revealing experiments in the history of economics," helps economists understand why people are often generous to complete strangers and why those complete strangers so often reciprocate. The key, Zak explains, is oxytocin. Our brains release oxytocin when we hug others, when we receive gifts and when we are trusted. Because elevated oxytocin levels in the blood make us more likely to trust others, oxytocin plays an essential role in all human interactions, including the process of wealth creation. As Zak puts it, "You can't induce your brain to release oxytocin, you can only give it to somebody else. If you give this gift, our biology has set us up so that people will return it to us."

Approximately 5.5 minutes.

Produced by Paul Feine & Alex Manning.

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