"Many people care greatly about their reputation and how they will be judged by others, and a concern about appearing honest may outweigh our desire to actually be honest, even in situations where it will cost us money to lie," said lead researcher Shoham Choshen-Hillel from The Hebrew University of Jerusalem, Israel.
"Our findings suggest that when people obtain extremely favourable outcomes, they anticipate other people's suspicious reactions and prefer lying and appearing honest over telling the truth and appearing as selfish liars," Choshen-Hillel added.
The study, published in the Journal of Experimental Psychology: General, found similar findings about lying to appear honest in a series of experiments conducted with lawyers and college students in Israel, as well as online participants in the US and UK.
In an experiment, 149 undergraduate students at an Israeli university played online dice-rolling and coin-flipping games in private and then reported their scores to a researcher.
The participants received approximately 15 cents for each successful coin flip or dice roll they reported.
The computer programme was manipulated for half of the students so they received perfect scores in the games, while the other group had random outcomes based on chance.
In the perfect-score group, 24 per cent underreported their number of wins even though it cost them money, compared with four per cent in the random-outcome group.
"Some participants overcame their aversion toward lying and the monetary costs involved just to appear honest to a single person who was conducting the experiment," Choshen-Hillel said.
In another online experiment with 201 adults from the US, participants were told to imagine a scenario where they drove on many work trips for a company that had a maximum monthly compensation of 400 miles.
They were told that most employees reported 280 to 320 miles per month.
Half of the participants were told they had driven 300 miles in a month while the other half were told they drove 400 miles.
When the participants were asked how many miles they would report, the 300-mile group told the truth and reported an average of 301 miles.
For the 400-mile group, the participants reported an average of 384 miles, with 12 per cent lying and underreporting their mileage.
There were similar findings in another online experiment with 544 participants in the US.
"While our findings may seem ironic or counterintuitive, I think most people will recognize a time in their lives when they were motivated to tell a lie to appear honest," Choshen-Hillel said.
( With inputs from IANS )