Home' Trinidad and Tobago Guardian : February 23rd 2017 Contents Last week there were reports of
an accident in which a wom-
an, seemingly distressed by
the entire incident, took off
her clothes and walked down
the street. While the situation
was unfolding, many onlookers took out their
phones, recorded the event and then passed
it on via various forms of social media. This
led to an outcry by many about the actions of
the witnesses to the event. There were sug-
gestions that it would have been easier for
people to offer a jacket, coat or some form of
assistance instead of recording the incident
on their phones.
The usual criticism of the broader society
then followed. There were lots of conclu-
sions that we as a people are heartless, cruel,
self-centred etc. What may add fuel to our
self-degeneration is the fact that this inci-
dent is not isolated and we have seen many
situations where a similar story has unfolded.
There are videos on social media of people
being beaten, some even killed, and enough
bystanders around to record the event but no
one stepping forward to challenge or change
the situation while it is unfolding.
In an environment where the use of social
media itself is under scrutiny, we would do
well as a country to understand what is taking
place and why.
The first thing we need to appreciate is the
experience of having people stand off and
watch a situation unfold without intervening
to help or to positively influence the outcome
is not unique to T&T.
Just run a Google search for The Richmond
High School incident and you will find the story
of the rape and beating of a 15-year-old girl by
multiple men over an extended period while
others filmed and watched. There are many
other individual examples that I can cite.
On a global scale, the Holocaust is the most
glaring example of presumably good people
standing idle while others are subjugated and
killed. The same can be said for slavery before
that and our indifference to Syrian refugees
tells a similar story and paints the same pic-
Here, at home, we have the scourge of kid-
napping and abductions where it is obvious
that some people somewhere must see some-
thing unusual in their surroundings before,
during and after the event. No one ever comes
What we are discussing is a phenomenon
that is fairly standard human behaviour. All of
us are susceptible unless we have been trained
otherwise. The first point is to avoid condem-
nation and judgment of others because it can
happen without us being fully aware that we
are part of the problem.
The theory suggests we as individuals are
less likely to offer assistance when others are
present. Put another way, we are more likely
to stand on the sidelines when in a crowd. This
is known as the Bystander Effect.
Low voter turnout is an example of the By-
stander Effect where even though we may be
politically aware, dissatisfied with the status
quo and even want to see change effected we
stand to the side instead of being the one to act.
Taking a cue from the above example, the
theory makes the point that the likelihood of a
person taking action is inversely proportional
to the number of individuals present. Simply
put, the bigger the crowd the less likely that
someone from that crowd will step forward
and seek to alter the events that are unfolding.
The obvious reason for this is the diffusion of
responsibility where we all stand and assume
someone else is responsible to act. When no
one comes forward we then assume that there
is a reason no one is coming forward and so we
then act in what seems to be our interest for
self preservation and the entire group stands
by and watches.
The lesson here is that if ever you were in a
situation of distress instead of a generic cry for
help to anyone and everyone it may be better
to select someone in the crowd and ask them
specifically for their assistance. That then
places the responsibility to act on an indi-
vidual and jolts the situation towards a more
You may be wondering why a column focused
primarily on investing and finance is dealing
with the issue of the Bystander Effect?
This effect is not just seen in crowds standing
by while people are in distress but it is seen
both in business and investing.
You speak to the average worker in a company
shop floor and they will tell you all the things
that are wrong with their company. They will
tell you if you ask and many times it forms the
basis for conversations between people outside
of their jobs.
Yet, many of these ideas and understandings
will never be presented to management inside
the company. The logic of the worker is: if they
know about it and their peers know about it
then surely management must know about it
too. The unwillingness of management to deal
with what seems to be obvious means that it is
so for a reason and to try to adjust the status
quo can likely have negative consequences for
my job so collectively we all sit quietly at our
desks and grumble.
An even more dire consequence occurs when
there is a case of wrongdoing.
There are many ethical violations that are
seen and known within the workplace. The
Bystander Effect helps to contribute to the
conspiracy of silence in that it assumes that
"this is how we do things around here" and
it is just accepted on the assumption is that
nothing will be done.
Measures such as whistleblowing have
sought to address the challenges resulting
from the Bystander Effect but before getting
to whistleblowing we have to pay more atten-
tion to ethics in the corporate world for people
to understand that there is a problem in the
The idea that everyone is involved in corrup-
tion makes it okay for the next corrupt practice
to take root and for everyone around to remain
silent because it is difficult to speak out against
a social norm and in any event "whom do I
speak to when everyone else is doing it."
The Bystander Effect occurs in the world of
investing as well.
There is a concept called the Wisdom of
Crowds, which suggests that the thinking of
a group is likely to be better than that of any
Simply put, the biases of each individual will
cancel each other out leading to a good overall
decision. This is why in gauging the price of a
stock some argue that the stock market itself
is always right.
The problem is that subtle influences can
also affect the wisdom of crowds. So when the
news flow related to a particular stock or the
stock market in general is positive the overall
crowd develops a positive bias and acts accord-
ingly, which is how stocks deviate from their
fundamental value and bubbles are formed.
When the market gets to the stage of a
bubble, many investors tend to sense that
something is wrong. You look at your gains
and wonder how much higher this can go.
You look at the company's performance and
wonder how much longer can they keep this
up. Is it all real?
Then you look around to see if anyone else
thinks this way just as the persons in the crowd
will look around when the individual in distress
cries for help. Yet you see no selling pressure
on the stock. It continues to rise and you shrug
your shoulders and say to yourself if no one is
selling then I must have gotten it wrong and
continue to do nothing.
Many times after the fact you look back and
see that it was obvious that the stock was over-
valued when you thought it was but you failed
to act at the time. The regret you feel then is the
same regret that many in a crowd of onlookers
will feel when the full extent of the situation
they witnessed comes to light.
The Bystander Effect comes to us in many
ways and in many circumstances. We would do
well to scrutinise our individual actions to see
where we have participated in this phenom-
enon before we point figures at others who
have acted in the same way but in a different
or even more public setting.
Ian Narine can be contacted at firstname.lastname@example.org
BG14 | FINANCE
BUSINESS GUARDIAN guardian.co.tt FEBRUARY 23 • 2017
The Bystander Effect
When the market gets to the stage of a bubble, many investors
tend to sense that something is wrong.
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