When a customer wrongs one business – such as returning a high-priced item after using it once or quietly pocketing extra change accidentally given to them – they are more likely to provide a positive rating to an unrelated company that wrongs them, a new study has found.

The reason? Karma.

Karma is an “irrational belief” that one’s actions are causally connected with subsequent outcomes in a way that good (bad) actions lead to good (bad) outcomes, either immediately or in a future point of life". In other words, people who believe in karma hold the belief that good actions lead to good outcomes while bad actions lead to bad outcomes.

“Karma has its roots in Eastern religions and culture. But now, karma has become a universal thing. It’s a set of beliefs that a lot of people intuitively have,” explains University of Toronto professor Pankaj Aggarwal, who co-authored the study.  

In a series of eight experiments, Aggarwal and his colleagues divided participants into “wrongdoing” conditions and “control” conditions, and tested their reactions to service failures in both real and imagined scenarios.

In one experiment, participants were asked to help design five advertising slogans, with compensation determined by an online dice game - the higher they rolled, the more money they could collect. (The game was programmed to always roll a one.) Those in the wrongdoing group were asked to self-report their result, giving them the opportunity to cheat.

The participants were then asked to rate a new online experimenting system, which was intentionally designed to be very slow. People who cheated in the dice-rolling game gave the slow online system a more favourable review – a finding that was consistent throughout the rest of the researchers’ experiments.

To confirm these compensative actions were related to karma, another group of participants were given a study about the irrationality of karma to read.

They were then asked to imagine breaking a cup at a store and hiding the evidence on a shelf. They were subsequently asked to imagine reserving a table at a restaurant, and later learning the table was mistakenly given to somebody else.

Aggarwal and his team found that those who read about the irrationality of karma gave a lower evaluation of the restaurant when compared with a second group (the karma control group) who did not read the same article.

To find further evidence that the evaluation of a subsequent service provider may be dependent on karma, the researchers employed a scale that directly assessed research participants’ karmic causal inference. Using this measure in the analysis showed that more positive assessment of the poorly performing service provider was driven by a higher score on the karmic causal inference – showing that only those participants showed a more positive evaluation who also had a higher karmic causal inference connecting their prior misdeed and the fact of experiencing poor service later.

The researchers also explored whether “moral balancing” might account for the behaviour.

“Moral balancing is this idea that you did something wrong and that’s immoral - and now you’re helping somebody, and that’s moral,” Aggarwal says. “It’s not about karma.”

To test moral balance reasoning, a third group was also asked to imagine breaking a cup at the store, quietly returning to the shelf, and later learning a reservation had been accidentally given to someone else. Their journey, however, was “interrupted” by an imaginary flat tire on their way to the restaurant.

And unlike participants in a karma control group, the moral balancing group gave the restaurant a low evaluation.

“If you commit a wrongdoing and you get a flat tire, you get your bad karma paid back. You did something wrong, and something wrong happened to you,” Aggarwal says. “Your positive evaluation of the restaurant goes away because your negative karma has already been paid through the flat tire.”

In essence, there was no need to re-align the “moral scales.” If these customers who got a flat tire were driven by moral balancing, they would still give the restaurant a positive review because they would feel it was the right thing to do after committing an immoral act against a company, he adds.

While the team didn’t look at differences in small wrongs (such as keeping a bit of extra change) versus big ones (such as giving false information to insurance companies), Aggarwal says that customer misdeeds can have major consequences for businesses. False information when buying auto insurance has resulted in at least $308.6 billion fraudulent claims annually, for example.

Aggarwal says that their study only looked at scenarios where a customer’s wrongdoing was fresh in their mind, but it still offers some takeaways for businesses. For instance, he says that marketers in industries with frequent service failures could explore campaigns that highlight prior consumer wrongdoings and belief in karma, which he and his co-authors say could spare marketers “the wrath of customers” when the company makes a mistake.  

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