Finnish capital Helsinki bagged the top spot for the world's most honest city in the survey, while Lisbon, the capital of Portugal, proved to be the least honest.
The survey put hundreds of people to test in four continents to find out just how honest they were by dropping wallets and seeing how many would be returned.
In the study, 192 wallets were dropped in cities in Europe, North and South America, and Asia. Each wallet contained a cell phone number, a family photo, coupons, business cards and the equivalent of USD 50 in cash.
The wallets were left in parks, near shopping malls and on sidewalks, and researchers watched to see what would happen. Of the 192 wallets dropped, 90 - or 47 per cent - were returned, according to the survey by Reader's Digest magazine.
In Helsinki, 11 out of 12 wallets were returned. "Finns are naturally honest, it's typical for us," said 27-year-old business student Lasse Luomakoski, who found the dropped wallet in the pedestrian street of Mikonkatu in downtown Helsinki.
In Mumbai, nine out of 12 wallets were returned. Vaishali Mhaskar, a mother of two, and a stamp vendor, returned a wallet that was left in Mumbai's General Post Office.
"I teach my children to be honest, just like my parents taught me," she said. Another person who returned a lost wallet was Rahul Rai, a 27-year-old video editor.
"My conscience wouldn't let me do anything wrong. A wallet is a big thing with many important documents [in it]," he said. Later that same day, three young adults found lost wallets and returned them, the magazine said.
For the world's third-most honest city, there was a tie between New York and Budapest, the capital of Hungary. Eight out of 12 wallets were returned in both cities.
Russian capital Moscow, and Amsterdam, the capital of Netherlands, both tied for the fifth place, with 7 out of 12 wallets being returned in the cities. German capital Berlin and Ljubljana, the capital of Slovenia, tied for seventh place on the list, with 6 out of 12 wallets being returned.
In Mumbai, nine out of 12 wallets were returned.
London, and Warsaw, the capital of Poland, where 5 out of 12 wallets were returned, were jointly ranked in the ninth position. The 11th place on the list of the world's most honest cities went to Bucharest, the capital of Romania, Rio de Janeiro and Zurich, where 4 out of 12 wallets were returned.
The least honest cities in the world were Prague, the capital of Czech Republic (3 out of 12 wallets returned), Spanish capital Madrid (2 out of 12 wallets returned) and Lisbon, the capital of Portugal, where only 1 out of 12 wallets was returned.
The survey also found that age is not likely to predict whether a person is going to be honest or dishonest. Across all 16 cities in which wallets were lost, young and old both kept the wallet or returned it.
Male and female, too, were unpredictable, although in two cities females stood out for two very different reasons.
In Warsaw, all the wallets lost were taken by women; in Ljubljana, of the six wallets returned, five were handed back by women. Comparative wealth was also no guarantee of honesty.
People in Moscow returned seven out of the 12 wallets whereas, in the more prosperous city of Zurich, only four wallets were returned.