Se editan los textos centrales de la conferencia pronunciada en 1860 por K. E. y. Baer, según la rara edición que hizo de la misma en ¡862. Su mostración imaginativa de lo diferente que sería nuestra representación de la realidad natural con el USO de otros cánones espacio-temporales, puede volver a interesar hoy, sobre todo, al llamado Constructivismo,Zentrale Texte des Vortrages von 1860, den It E. y. Baer lii Petesbrug hielt, nach der seltenen Ausgabe von 1862, sowie ibre spanische Ubersetzung (...) sind hier herausgegeben. Seine imaginative Darstellung der ganz verschiedenen Auffasung der Natur nach der Veránderung des Raum-Zeit-Mai3stabes gelten jinmer noch als Anregung ciner fruchtbaren Reflexion, tiberhaupt in Zeiten des sogenannten Konstruktivismus. (shrink)

Coping with uncertainty is a necessary part of ordinary life and is crucial to an understanding of how the mind works. For example, it is a vital element in developing artificial intelligence that will not be undermined by its own rigidities. There have been many approaches to the problem of uncertain inference, ranging from probability to inductive logic to nonmonotonic logic. Thisbook seeks to provide a clear exposition of these approaches within a unified framework. The principal market for the book (...) will be students and professionals in philosophy, computer science, and AI. Among the special features of the book are a chapter on evidential probability, which has not received a basic exposition before; chapters on nonmonotonic reasoning and theory replacement, matters rarely addressed in standard philosophical texts; and chapters on Mill's methods and statistical inference that cover material sorely lacking in the usual treatments of AI and computer science. (shrink)

State ownership, worker ownership, and household ownership are the three main forms in which productive assets (firms) can be held. I argue that worker ownership is not wise in economies with high capital-labor ratios, for it forces the worker to concentrate all her assets in one firm. I review the coupon economy that I proposed in 1994, and express reservations that it could work: greedy people would be able to circumvent its purpose of preventing the concentration of corporate wealth. Although (...) extremely high corporate salaries are the norm today, I argue these are competitive and market determined, a consequence of the gargantuan size of firms. It would, however, be possible to tax such salaries at high rates, because the labor - supply response would be small. The social-democratic model remains the best one, to date, for producing a relatively egalitarian outcome, and it relies on solidarity, redistribution, and private ownership of firms. Whether a solidaristic social ethos can develop without a conflagration, such as the second world war, which not only united populations in the war effort, but also wiped out substantial middle-class wealth in Europe - thus engendering the post-war movement towards social - insurance is an open question. (shrink)

The multilinear extension of a cooperative game was introduced by Owen in 1972. In this contribution we study the Lovász extension for cooperative games by using the marginal worth vectors and the dividends. First, we prove a formula for the marginal worth vectors with respect to compatible orderings. Next, we consider the direct market generated by a game. This model of utility function, proposed by Shapley and Shubik in 1969, is the concave biconjugate extension of the game. Then we obtain (...) the following characterization: The utility function of a market game is the Lovász extension of the game if and only if the market game is supermodular. Finally, we present some preliminary problems about the relationship between cooperative games and combinatorial optimization. (shrink)

Standard economic theory does not capture trust among anonymous Internet traders. But when traders are allowed to have social preferences, uncertainty about a seller’s morals opens t he door for trust, reward, exploitation and reputation building. We report experiments suggesting that sellers’ intrinsic motivations to be trustworthy are not sufficient to sustain trade when not complemented by a feedback system. We demonstrate that it is the interaction of social preferences and cleverly designed reputation mechanisms that solves to a large extent (...) the trust problem on Internet market platforms. However, economic theory and social preference models tend to underestimate the difficulties of promoting trust in anonymous online trading communities. (shrink)

As thinkers in the market for knowledge and agents aspiring to morally responsible action, we are inevitably subject to luck. This book presents a comprehensive new theory of luck in light of a critical appraisal of the literature's leading accounts, then brings this new theory to bear on issues in the theory of knowledge and philosophy of action.

Business firms have been explained as internal markets or as communities. To be sustainable, however, they need to reconcile these two constituting elements that have mainly been touted as opposite and part of a dualistic relationship. We suggest that organizations may, in alternative, view market and community as part of a duality, interdependent and mutually constituting processes that may not only contradict each other but also enable one another. The implications of a duality view for business ethics, which articulates market (...) and community elements in a fruitful, mutually enabling relationship, are considered, and duality is presented as a way of transcending what is commonly viewed as opposition, moving organizations both in the direction of humane and competitive finalities. (shrink)

The historical features of the playing of the flute group in the symphony orchestra, the ability of soloists-instrumentalists to be performers of a single group and a single whole among the large composition of members of the symphony orchestra are analyzed. The authors substantiate the expediency of the development of instrumental musicians first of all as orchestra players, and then as solo performers. The aim and the tasks: to analyze the historical development of the ensemble playing of the flute group (...) as part of the symphony orchestra. The tasks of the research are the analysis of publications on this issue and the selection of the necessary components for playing a group of flutes in a symphony orchestra.Research methods: the research methodology consists of the ratio of traditional and modern expedient, ascent from individual to generalized (generalizing principle) from abstract to concrete. Research results: a wide range of research on the musical performance process from the New Age to the present is analyzed. Analysis of new modern concepts of training of instrumental musicians in institutions of higher education is carried out. The European search for new forms is characterized by the search for objective regularities in music education of past centuries, taking into account the modern demand for orchestra players on the European labor market. Discussion. What should come first in the training of an orchestra playerindividual classes or his training in a team. Conclusion. Thus, the analysis of the historical development of the ensemble playing of the flute group in the symphony orchestra allowed us to draw the following conclusions: during the reign of the classicism and romantic styles, an understanding of the necessary components for a symphony orchestra artist in the flute group was formed: a the component of pure vertical and horizontal intonation; a the component to feel the dynamic balance of all participants in the ensemble playing of the flute group as part of the symphony orchestra; a component of the timbre fusion of the flute group and full sounding in different registers; a component understanding in performing strokes in groups of flutes; a component of expressiveness and vivid phrasing of the ensemble playing of a group of flutes as part of a symphony orchestra; a component of metrorhythmic feeling in ensemble playing; a component of the collective understanding of style by a group of flautists in a symphony orchestra. All these components in their unity will allow the group of flutes to sound as a single harmonious whole. (shrink)

Innovations in web technologies, data warehousing and data mining enable Internet marketers to collect, process and analyze personal data gathered from web users browsing and online purchase habits on a much greater scale as it is now quicker and more economical to do so. Recent surveys indicate that consumers are not comfortable with these practices, especially when the data is collected or sold without their consent. The resulting conflict of interest demands a solution. In this paper, a framework of incomplete (...) markets, property rights and transaction costs is used to analyze the problem and propose some preliminary solutions. (shrink)

This is a systematic evaluation of the main arguments for and against the market as an instrument of social organization, balancing efficiency and justice. It links the distinctive approaches of philosophy and economics to this evaluation.

The beginning of the journey -- What this book is about : using ideas from mathematics, economics, and physics to tackle the big questions in philosophy : what is real? what can we know? what is the difference between right and wrong? and how should we live? -- Reality and unreality -- On what there is -- Why is there something instead of nothing? the best answer I have : mathematics exists because it must and everything else exists because it (...) is made of mathematics, with an excursion into artificial intelligence -- Unfinished business -- Unfinished business from chapter two : the nature and purpose of economic models -- How Richard Dawkins got it wrong -- Why Dawkins's argument against intelligent design can't be right and a mathematical analysis of the arguments for the existence of God -- Belief -- Daydream believers -- Most beliefs are ill-considered because most false beliefs are costless to hold -- The next several chapters will explore the consequences of this observation before we return to the question of where our beliefs and knowledge come from -- Unfinished business -- Unfinished business from the preceding chapter : how color vision works, sound, and water waves, the sheer craziness of economic protectionism -- Do believers believe? -- Our ill-considered beliefs about religion : why I believe that almost nobody is deeply religious -- On what there obviously is -- Our ill-considered beliefs about free will, ESP, and life after death -- Diogenes's nightmare -- How is legitimate disagreement possible if you're arguing with someone who is as intelligent and informed as you are, shouldn't you put just as much weight on your opponent's arguments as your own? -- The fact that we persist in disagreeing is strong evidence that we don't really care what's true -- Knowledge -- Knowing your math -- Where mathematical knowledge comes from and logic and why evidence and logic are not enough -- Unfinished business -- Unfinished business from the preceding chapter : the tale of hercules and the hydra, with an excursion into the lore of very large numbers -- Incomplete thinking -- Godel's incompleteness theorem and what it doesn't say about the limits of human knowledge -- The rules of logic and the tale of a Potbellied pig -- The power of logical thought, with excursions into the most counterintuitive theorem in all of mathematics and the tale of a potbellied pig -- The rules of evidence -- What we can and can't learn from evidence, with excursions into the value of preschool and how internet porn prevents rape -- The limits to knowledge -- What physics does and doesn't tell us about what we can and cannot know -- Understanding Heisenberg's uncertainty principle -- Unfinished business -- The oddness of the quantum world and why it matters to game theorists -- Right and wrong -- Telling right from wrong -- Some hard questions about right and wrong and about life and death -- The economist's golden rule -- A rule of thumb for good behavior -- How to be socially responsible -- Putting the rule of thumb into practice -- On not being a jerk -- Goofus and gallant on immigration policy -- The economist on the playground -- Our ill-considered beliefs about fairness in the market place and in the voting booth, contrasted with our carefully considered beliefs about fairness on the playground -- Unfinished business -- How ancient talmudic scholars anticipated modern economic theory -- The life of the mind -- How to think -- Some basic rules for clear thinking, mostly about economics, but also about arithmetic, neurobiology, sin, and eschewing blather -- What to study -- Advice to college students : stay away from the English department and approach the philosophy department with caution, with an excursion into the remarkable life of Frank Ramsey. (shrink)

From a giant of health care policy, an engaging and enlightening account of why American health care is so expensive -- and why it doesn't have to be. Uwe Reinhardt was a towering figure and moral conscience of health care policy in the United States and beyond. Famously bipartisan, he advised presidents and Congress on health reform and originated central features of the Affordable Care Act. In Priced Out, Reinhardt offers an engaging and enlightening account of today's U.S. health care (...) system, explaining why it costs so much more and delivers so much less than the systems of every other advanced country, why this situation is morally indefensible, and how we might improve it. The problem, Reinhardt says, is not one of economics but of social ethics. There is no American political consensus on a fundamental question other countries settled long ago: to what extent should we be our brothers' and sisters' keepers when it comes to health care? Drawing on the best evidence, he guides readers through the chaotic, secretive, and inefficient way America finances health care, and he offers a penetrating ethical analysis of recent reform proposals. At this point, he argues, the United States appears to have three stark choices: the government can make the rich help pay for the health care of the poor, ration care by income, or control costs. Reinhardt proposes an alternative path: that by age 26 all Americans must choose either to join an insurance arrangement with community-rated premiums, or take a chance on being uninsured or relying on a health insurance market that charges premiums based on health status. An incisive look at the American health care system, Priced Out dispels the confusion, ignorance, myths, and misinformation that hinder effective reform. (shrink)

The healthcare crisis that has developed in the last two decades during China's economic reform has caused healthcare and hospital financing reforms to be largely experienced by patients as a crisis in the patient–healthcare professional relationship (PPR) at the bedside. The nature and magnitude of this crisis were epitomized by the "Harbin Scandal"—an incident that took place in August 2005 in a Harbin teaching hospital in which the family of an elderly patient hospitalized in the intensive care unit (ICU) for (...) 66 days paid over RMB ¥6 million. The news was publicized globally and ended in the firing of six top hospital administrators including the hospital president and the ICU director. This paper seeks to show that the Chinese healthcare crisis is ultimately linked to a conflict of interests between patients and healthcare professionals (HCPs), which is inherent in the reformed healthcare system of China. Hence the crisis is, at its core, a crisis of fidelity and confidence that must be restored to the PPR. At the "macro" level, it is simplistic to blame the crisis on the failure of the market system, and at the "micro" level, it is naïve to expect that a contractual understanding of the PPR will effectively restore the confidence of patients. This paper will show that the fiduciary relationship and medical professionalism share similar attributes, with fidelity being the core value of both. It concludes that the loss of medical fidelity implies the dissolution of the PPR and the demise of the medical profession and challenges Chinese HCPs to keep their fidelity as a means to both protect their patients’ interests and to preserve their profession's survival. (shrink)

The current system of organ procurement which relies on donation is inadequate to the current and future need for transplantable kidneys. The growing disparity between demand and supply is accompanied by a steep human cost. I argue that a regulated market in organs from living vendors is the only plausible solution, and that objections common to opponents of organ markets are defeasible. I argue that a morally defensible market in kidneys from living vendors includes four characteristics: (1) the priority of (...) safety for both vendors and recipients, (2) transparency regarding the risks to vendors and recipients, (3) institutional integrity regarding guidelines for cooperating with kidney vendors, and (4) operation under a rule of law. I conclude with some remarks on remaining problems with this account, and offer some suggestions as to how these problems might be addressed. (shrink)

The advance of technology has influenced marketing in a number of ways that have ethical implications. Growth in use of the Internetand e-commerce has placed electronic “cookies,” spyware, spam, RFIDs, and data mining at the forefront of the ethical debate. Some marketers have minimized the significance of these trends. This overview paper examines these issues and introduces the two articles that follow. It is hoped that these entries will further the important “marketing and technology” ethical debate.

Many large corporations now have written codes of ethics to guide the business/marketing activities of employees. The purpose of this study was to determine the frequency and types of topics which are covered in the ethics policy statements of large U.S. corporations. The results indicated that the topics covered most often (respectively) were: misuse of funds/improper accounting, conflicts of interest, political contributions, and confidential information. It is concluded that in addition to written ethics policy statements, top management should communicate (...) ethical values and demonstrate by example. (shrink)

"This comprehensive volume - containing 27 chapters and contributions from six continents - presents and discusses key principles, perspectives, and practices of social learning in the context of sustainability. Social learning is explored from a range of fields challenged by sustainability including: organizational learning, environmental management and corporate social responsibility; multi-stakeholder governance; education, learning and educational psychology; multiple land-use and integrated rural development; and consumerism and critical consumer education. An entire section of the book is devoted to a number of (...) reflective case studies of people, organizations and communities using forms of social learning in moving towards sustainability. 'This book brings together a range of ideas, stories, and discussions about purposeful learning in communities aimed at creating a world that is more sustainable than the one currently in prospect....The book is designed to expand the network of conversations through which our society can confront various perspectives, discover emerging patterns, and apply learning to a variety of emotional and social contexts.' From the Foreword by Fritjof Capra, co-founder of the Center of Ecoliteracy. 'Joining what is so clear and refreshing in this book with the larger movements toward a critically democratic and activist education that is worthy of its name, is but one step in the struggle for sustainability. But it is an essential step if we are to use the insights that are included in this book.' From the Afterword by Michael Apple, author of 'Educating the ""Right"" Way: Markets, Standards, God, and Inequality'.". (shrink)

Examines Adam Smith's main principles in Wealth of Nations as the basis for effective policymaking. Adam Smith proposed several principles that would help mitigate or eliminate some of the problems we face as a nation today. Many assume that our current laissez-faire capitalism applies his principles. But, in contrast to the libertarianism of the United States, Smith's recipe to increase everyone's wealth and happiness was justice, liberty, and equality. This book examines Adam Smith's main principles in Wealth of Nations as (...) the basis for effective policymaking. Adam Smith wanted to increase happiness through this formula for a good life: equality, liberty, and justice. Free market interpretations of Smith, the book argues, grossly misrepresent his thought, emphasizing only liberty and not also equality and justice. This book suggests policies that combine all three in order for happiness to be maximized. (shrink)

While e-commerce has grown rapidly in recent years, some of the practices associated with certain aspects of marketing on the Internet, such as pop-ups, cookies, and spam, have raised concerns on the part of Internet users. In this paper I examine the nature of these practices and what I take to be the underlying source of this concern. I argue that the ethical issues surrounding these Internet marketing techniques move us beyond the traditional treatment of the ethics of (...) marketing and advertising found in discussions of business ethics previously. Rather, I show that the questions they raise ultimately turn upon questions of technique and the ways in which technologies can transform the fundamental means by which relationships are established and maintained within a social environment. I then argue that the techniques of e-commerce are indeed transforming the means by which businesses relate to consumers, and that this transformation is affecting the applicability of our previous ways of demarcating the imperatives determining the limits of accessibility between consumers and businesses. Properly addressing the ethical status of the techniques of e-marketing as such necessarily moves us to consider the changes that Internet commerce are having upon the norms that govern individuals in their relations with others. (shrink)

Concerns for safety and security as South Africa’s hosting of 2010 FIFA World Cup draws nearer highlight the degree to which South Africa’s reputation for a relatively peaceful transition from Apartheid has been replaced by its reputation for violent crime. Its transition, and the peacebuilding efforts that followed it, are not completely unrelated to its current high levels of violent crime. In fact, this article argues that there were a number of issues South Africa’s peacebuilding process failed to address that (...) are relevant to the country’s violent crime situation. A significant reason for this failure was an inability or unwillingness to engage the full spectrum of Apartheid’s violence with equal rigour. Apartheid inflicted structural violence, through its racially oppressive laws, as well as physical violence, through enforcing its laws and suppressing its opposition, on the people of South Africa. Peacebuilding in South Africa primarily focused on Apartheid’s physical violence. Through the work of the Truth and Reconciliation Commission, the focus was narrowed down further to physical political violence. Due to this narrow focus, it did not attend effectively to non-political violence – which includes gender-based violence, the esteem violence had attained during and due to Apartheid, disarming the country of illegal firearms, and narrowing the income gap between the country’s rich and poor. While South Africa proudly claims ownership of its conflict resolution and peacebuilding processes, it still emulated predominant models of building peace through liberal democracy and a market economy. These models have been drawn from Western success stories in diminishing interstate conflict, while South Africa is a developing country that was recovering from an intrastate conflict. Pursuing these models has had benefits for South Africa, but not in many of the ways it needed in order to effectively prevent a surge in criminal violence in the wake of Apartheid. (shrink)

The paper challenges a minimalist strategy in business ethics that maintains if it's legal, it's moral. In hard cases, judges decide legal issues by appealing to moral ideals. Investigation shows that the bedrock concept is fairness. Often judges define fairness in terms of non-coerciveness or equality of bargaining power. The prudent manager must look beyond the legal department to the ethical notion of fairness. Moreover, if the courts were to consistently appeal to non-coerciveness and equality of bargaining power, some practices (...) now considered morally acceptable would be neither moral nor legal. (shrink)

This book is about the mind and its connection to the brain. The first two chapters discuss the basic characteristics of the mind, and places it in historical context by noting trends in popular culture, and various people's ideas about the mind. This discussion ends by concluding that the most fruitful approach to studying the mind is a scientific approach that looks for connections between the mind and the brain. The last four chapters focus on the following specific principles: The (...) operation of the mind is hidden; Prediction is an important function of the mind; and Connectivity and communication between different areas of the mind are crucial for the mind's operation. An important feature of this discussion is that it is supported by empirical research, by briefly describing experiments. This book therefore goes beyond simply presenting conclusions, by elucidating the procedures and reasoning that led to those conclusions. The intent of the book is to give readers a feel for the latest scientific thinking about the mind, by focusing on basic principles that hold across many different functions of the mind. One key to marketing the book is to emphasize the fact that the writing makes a fascinating, but complex, subject accessible to the general reader. (shrink)

Decisions related to animal welfare standards depend on farmer’s multiple goals and values and are constrained by a wide range of external and internal forces. The aim of this paper is twofold, i.e., to develop a theoretical framework for farmers’ AW decisions that incorporates farmers’ goals, use and non-use values and to present an approach to empirically implement the theoretical framework. The farmer as a head of the farm household makes choices regarding production to maximize the utility of the household. (...) The overall utility of the farmer is determined by his multiple objectives. For the analysis of multi-objective problems, the multiple criteria decision - making paradigm provides an appropriate theoretical framework. However, theories from the field of social-psychology are needed to facilitate the identification of all relevant aspects in the decision making. The practical use of the conceptual framework is demonstrated using a simple numerical application of a multi-objective programming model. Two workshops were devoted to examining the scientific consistency and the practical usefulness of the approach. Implementing this approach will increase knowledge of the main factors and barriers that determine farmers’ decisions with regard to AW standards. This knowledge is relevant during the development of new AW concepts that aims to supply products that comply with above-legal AW standards for middle-market segments. (shrink)

When an organization is pressured to respond to moral expressions in capital, consumer and labor markets, it faces a dilemma of how to respond. Should Shell have given in to Greenpeace in deciding how to dispose of the Brent Spar Oil Rig? Should Cracker Barrel give in to pressures to fire homosexual employees? Firms should consider the nature of the moral expressions pressuring them in deciding how to respond. Moral expressions can be divided into three descriptive categories: Benign, Disputed and (...) Problematic. Each carries different implications for corporate action and in some cases will justify corporate resistance to moral expressions by stakeholders. In order to appropriately respond to moral pressures, firms should first engage in a process of discovery aimed at identifying moral pressures relevant to the firmös missions and objectives and then engage in a process of justification concerning their responses. Such a conclusion is consistent with important trends of contemporary thought in ethics and political philosophy and is strongly supported by Kantian analysis. (shrink)

The current study is designed to propose and test a model about the ethical reputation of a target manager who must decide whether to engage in earnings management. We employ an experimental approach to examine the potential negative reputation effects within the internal labor market of a firm that occur as a consequence of earnings management. We examine participants’ responses to a hypothetical (target) manager when both the target’s behavior and the corporate incentives were manipulated. Participants assessed how ethical they (...) believed a target manager to be, based on the target’s decision regarding earnings management and the nature of the corporate incentives. Participants also assessed the target’s managerial ability. Participants’ judgments regarding the target’s morality were significantly affected by the target’s behavior, but were not affected by the incentive structure. Ability judgments were significantly and positively related with morality assessments. Further analysis indicates that morality assessments mediate the relationships between the target’s behavior and the participants’ willingness to extend work-related opportunities to the target. Implications of these results for management control systems design and for future research are discussed. (shrink)

This book brings together in one place the work of one of our most respected economic theorists, on a field in which he has played a large part in originating: the New Institutional Economics. Transaction cost economics, which studies the governance of contractual relations, is the branch of the New Institutional Economics with which Oliver Williamson is especially associated.Transaction cost economics takes issue with one of the fundamental building blocks in microeconomics: the theory of the firm. Whereas orthodox economics describes (...) the firm in technological terms, as a production function, transaction cost economics describes the firm in organizational terms, as a governance structure. Alternative feasible forms of organization--firms, markets, hybrids, bureaus--are examined comparatively. The analytical action resides in the details of transactions and the mechanisms of governance.Transaction cost economics has had a pervasive influence on current economic thought about how and why institutions function as they do, and it has become a practical framework for research in organizations by representatives of a variety of disciplines. Through a transaction cost analysis, The Mechanisms of Governance shows how and why simple contracts give way to complex contracts and internal organization as the hazards of contracting build up. That complicates the study of economic organization, but a richer and more relevant theory of organization is the result. Many testable implications and lessons for public policy accrue to this framework. Applications of both kinds are numerous and growing.Written by one of the leading economic theorists of our time, The Mechanisms of Governance is sure to be an important work for years to come. It will be of interest to scholars and students of economics, organization, management, and law. (shrink)

Futurists have imagined the Internet as a separate “cyberspace” and as a force for an idealized marketplace. Business practice and economic theory, however, lead to a different picture. (1) “Always-on” connections bring new interface problems and social skills. (2) Reduced transaction costs and increased economies of scale bring outsourcing, concentration, and globalized economy of focused monopolies. (3) The economies of scope inherent in modular computing systems bring “shallow diversity”: processes and products generated by a common underlying framework. This new picture (...) omits many countervailing factors. Even so, the very existence of alternative scenarios should sharpen questions for research. (shrink)

The ‘marketplace of ideas’ is an influential metaphor with widespread currency in debates about freedom of speech. We explore a number of ways competition between ideas might be described as occurring in a marketplace and find that none support the use of the metaphor. We suggest that an alternative metaphor, that of the ‘garden of ideas’, may offer more productive insights into issues surrounding the regulation of speech.

This article outlines an approach for implementing business ethics. A company should both organize for ethical business policies and execute them. The organizational dimension refers to structural components including codes of ethics, conferences and training programs and an ethical audit. The corporate culture must support these structural elements with top management playing a central role in implementing ethics. The execution of ethical business policies includes implementation responsibilities and tasks. These responsibilities are leadership in ethics, delegation, communication and motivation of the (...) company's ethical position to employees. Execution tasks are delineated for the marketing function. Although many company examples are provided, a program in place at McDonnell Douglas is highlighted as a model of ethics implementation. (shrink)

The current study is designed to propose and test a model about the ethical reputation of a target manager who must decide whether to engage in earnings management. We employ an experimental approach to examine the potential negative reputation effects within the internal labor market of a firm that occur as a consequence of earnings management. We examine participants’ responses to a hypothetical (target) manager when both the target’s behavior and the corporate incentives were manipulated. Participants assessed how ethical they (...) believed a target manager to be, based on the target’s decision regarding earnings management and the nature of the corporate incentives. Participants also assessed the target’s managerial ability. Participants’ judgments regarding the target’s morality were significantly affected by the target’s behavior, but were not affected by the incentive structure. Ability judgments were significantly and positively related with morality assessments. Further analysis indicates that morality assessments mediate the relationships between the target’s behavior and the participants’ willingness to extend work-related opportunities to the target. Implications of these results for management control systems design and for future research are discussed. (shrink)

If free markets consist in nothing more than “capitalist acts between consenting adults,” and if in the old legal maxim “volenti non fit injuria,” then it seems to follow that free markets do no wrongs. But that defense of free markets wrenches the “volenti” maxim out of context. In common law adjudication of disputes between two parties, it is perfectly appropriate to cast standards of “volenti” narrowly, and largely ignore “duress via third parties” (wrongs done to or by others who (...) are not themselves party to the action). In economic markets, of course, those third-party effects are rife. But we want them to be rectified systematically, not piecemeal through particular cases between particular parties that happen to come to court. That is the proper province of political philosophers and system-designers, in critiquing and constraining the operation of the market. (shrink)

Arthur Anderson & Co. has made a significant contribution to assist and encourage the teaching of business ethics. They provided assistance initially through workshops and curriculum materials; currently they are using campus coordinators to disseminate information and materials. The curriculum materials can be used by the instructor to assist students in practicing their moral reasoning skills and cover four academic areas: Accounting, Finance, Marketing, and Management. These materials include business ethics video vignettes, suggestions on presentation methods, guidelines for implementing (...) a stakeholders' analysis approach to ethical reasoning, and possible discussion questions. The vignettes present ethical dilemmas that persons may encounter in entry level positions. We have used the vignettes, the accompanying discussion questions, and the suggested stakeholder analysis in class presentations. This paper presents a discussion of the basic concepts associated with cooperative learning, an example of the implementation of cooperative learning techniques using the Arthur Andersen Accounting Ethics Vignettes, and empirical results of the influence of these particular group discussions on the students' ethical responses. We did not attempt to measure whether the individuals' moral levels changed, but whether the group discussions stimulated any changes in the students attitudes toward the particular ethical dilemma they viewed. (shrink)

The financial Crunch of 2008 was easily explained by both the left and right–too easily. Each insisted that events thoroughly confirmed its own long-held views and utterly refuted those of the opposed camp. This essay argues that there are indeed new lessons to be drawn from the Crunch, lessons that involve balancing the bounty of the Invisible Hand against perils of the Prisoner's Dilemma. Liberal moral imperatives are traced to variables of Personal Choice and External Cost that are typically in (...) tension with each other and thus generate needs for institutional reconstructions that change according to time and circumstance. Personal bankruptcy protection, limited liability corporations, and intellectual property are cited as examples. It is argued that the Crunch occurred because of failure adequately to balance these variables. Three paradoxes came to a head in 2008: Paradox of Efficient Markets; Paradox of Reduced Risk; Paradox of Hard-won Knowledge. The essay concludes with suggestions concerning specific lessons to be drawn from the Crunch and a corresponding list of lessons not to be drawn. (shrink)

We assert that audit quality can be improved to the extent that social norms for honesty and responsibility are activated in the auditor. To test this assertion, we use an experimental audit market setting found in the literature and manipulate factors expected to activate honesty and responsibility norms in the auditor. We find that auditor misreporting is reduced when the investor is another participant in the experiment rather than computer simulated, and thus, the interests of third-party investors are salient to (...) the auditor. We also find that auditor misreporting is reduced when the auditor is required to sign-off on the audit report, but only when the investor is another participant in the experiment. Consistent with our underlying theory, we find that pre-experimental measures of sensitivity to honesty and responsibility norms help explain the effects of our manipulated variables. Finally, we find that these measures of social norm sensitivity are associated with the moral judgment that auditor misreporting is unethical. Our study helps explain previous anomalous findings in the literature and answers the call in Blay et al. (J Bus Ethics 2017. doi:10.1007/s10551-016-3286-4) for empirical researchers to use social norm theory to develop stronger tests of moral reasoning in the market for auditing services. (shrink)