the effects of scarcity on cheating and in group favoritism abstract we study the impact of scarcity on cheating and in group favoritism using a two period lab in the field experiment with low income coffee farmers in a small isolated village in guatemala during the coffee harvesting months farmers in this village experience a significant income boost from selling their coffee beans however during the non harvesting months they experience a substantial decline in income inducing a pronounced state of scarcity while other factors remain similar using this distinctive variance in income we first conduct our experiment before the coffee harvest scarcity period we then repeat the experiment with the same group of subjects during the harvest season abundance period first using the fischbacher and follmi heusi 2013 die roll paradigm we find that subjects cheat at high levels in both periods when they are the beneficiaries of the cheating scarcity does not impact this cheating behavior secondly using subjects natural village identity we find significant in group favoritism for cheating in the abundance period which disappears during the scarcity period finally using a dictator game we show that this finding holds even when the cost of favoring an in group member is monetary rather than moral

attitudes toward risk and the risk return paradox prospect theory explanations this study attempted to explain bowman s risk return paradox in terms of recent research in behavioral decision theory and prospect theory the research emphasized the role of reference or target

the corporate psychopaths theory of the global financial crisis this short theoretical paper elucidates a plausible theory about the global financial crisis and the role of senior financial corporate directors in that crisis the paper presents a theory of the global financial crisis which argues that psychopaths working in corporations and in financial corporations in particular have had a major part in causing the crisis this paper is thus a very short theoretical paper but is one that may be very important to the future of capitalism because it discusses significant ways in which corporate psychopaths may have acted recently to the detriment of many further research into this theory is called for

who ll stop lying under oath empirical evidence from tax evasion games using two earned income tax declaration experimental designs we show that only partial liars are affected by a truth telling oath a non price commitment device under oath we see no change in the number of chronic liars and fewer partial liars rather than smoothly increasing their compliance we also observe that partial liars who respond to the oath respond by becoming fully honest under oath based on both response times data and the consistency of subjects when several compliance decisions are made in a row we show that partial lying arises as the result of weak preferences towards profitable honesty the oath only transforms people with weak preferences for lying into being committed to the truth

designing self reporting regimes to encourage truth telling an experimental study abstract we report results from an experiment that investigates truthfulness in self reporting under different reporting regimes the experiment involves a production task with self reporting of accidents with reporting compulsory for some participants but only voluntary for others we find that dishonesty is prevalent but accident reporting is more frequent with compulsory reporting compared with voluntary our results suggest that the lie aversion effect is stronger than any potential crowding out of intrinsic motivation to voluntarily report and that careful design of self reporting regimes is necessary by enforcement agencies to achieve satisfactory compliance outcomes our results are relevant for areas beyond regulatory compliance including dishonesty in social security claims insurance claims workplace expense claims income tax returns and financial reporting

does foreign aid increase private investment evidence from panel cointegration this article uses panel cointegration and causality techniques to examine the long run relationship between foreign aid and private investment our main result is that aid has a statistically significant negative effect on private investment this result is robust to outliers different measures and forms of aid sample selection and the sample period in addition we find that long run causality runs in both directions suggesting that an increase in aid reduces private investment and that in turn higher private investment leads to lower aid inflows

representative evidence on lying costs abstract a central assumption in economics is that people misreport their private information if this is to their material benefit several recent models depart from this assumption and posit that some people do not lie or at least do not lie maximally these models invoke many different underlying motives including intrinsic lying costs altruism efficiency concerns or conditional cooperation to provide an empirically validated microfoundation for these models it is crucial to understand the relevance of the different potential motives we measure the extent of lying costs among a representative sample of the german population by calling them at home in our setup participants have a clear monetary incentive to misreport misreporting cannot be detected reputational concerns are negligible and altruism efficiency concerns or conditional cooperation cannot play a role yet we find that aggregate reporting behavior is close to the expected truthful distribution suggesting that lying costs are large and widespread further lab experiments show that this result is not driven by the mode of communication

do norms on contribution behavior affect intrinsic motivation field experimental evidence from germany abstract this paper studies how imposing norms on contribution behavior affects individuals intrinsic motivation we consider the church levy which the catholic church in germany collects as a charitable donation despite the fact that the levy is legally a tax we design a randomized field experiment with treatments informing individuals that the levy is a tax we demonstrate that treatment effects differ across motivational types among weakly intrinsically motivated individuals communicating the legal norm results in a significant crowd out of intrinsic motivation in contrast strongly intrinsically motivated individuals do not show any treatment response

a theory of collective reputations with applications to the persistence of corruption and to firm quality the paper is a first attempt at modelling the idea of group reputation as an aggregate of individual reputations a member s current incentives are affected by his past behaviour and because his track record is observed only with noise by the group s past behaviour as well the paper thus studies the joint dynamics of individual and collective reputations and derives the existence of stereotypes from history dependence rather than from a multiplicity of equilibria or from the existence of a common trait as is usually done in the literature it shows that new members of an organization may suffer from an original sin of their elders long after the latter are gone and it derives necessary and sufficient conditions under which group reputations can be rebuilt last the paper applies the theory to analyse when a large firm can maintain a reputation for quality 1 collective reputations collective reputations play an important role in economics and the social sciences countries ethnic racial or religious groups are known to be hard working honest corrupt hospitable or belligerent some firms enjoy substantial rents from their reputations for producing high quality products some departments are reported to treat their faculty or students fairly the paper is a first attempt at modelling the idea of group reputation as an aggregate of individual reputations a member s current incentives are affected by her past behaviour and because her track record is observed only with noise by the group s past behaviour as well the paper studies the joint dynamics of individual and collective reputations in a model in which current generations are progressively replaced by new ones and derives the existence of stereotypes from history dependence rather than from a multiplicity of equilibria or from the existence of a common trait as is usually done in the literature see section 2 for a detailed comparison with the literature it shows that new members of an organization may suffer from an original sin of their elders long after the latter are gone and it derives necessary and sufficient conditions under which group reputations can be rebuilt last the paper applies the theory to analyse when a large firm can maintain a reputation for quality let us spell out the building blocks of our theory in more detail a a group s reputation is only as good as that of its members each member is characterized by individual traits such as talent diligence or honesty past individual behaviour conveys information about these traits and generates individual reputations

white collar crime writ small a case study of bagels donuts and the honor system for more than a decade an mit trained economist has meticulously recorded the results of nearly 75 000 deliveries of bagels and donuts to corporate offices these bagels and donuts are left in workplaces in the morning along with a list of prices and a lockbox office workers purchase the products on the honor system later that day the uneaten goods and the lock box are collected and the relevant data for each office are recorded in a spreadsheet these data provide a unique opportunity for understanding the extent to which individuals behave honestly in this setting and the factors that influence the level of honesty an analysis of the discrepancy between the prices of the goods consumed and the actual payments deposited in the lock box yields a number of insights first the base payment rate is quite high on average payments represent almost 90 percent of the posted price in a model of pure self interest one would expect very low payment rates because there would seem to be many opportunities for individuals to take the products with almost no chance of their nonpayment being detected moderating the tendency to take the products without paying is the fact that low payment rates will increase the probability the delivery company stops serving the company paying for one s bagels and donuts viewed in this light is a public good for other office workers thus one might expect a strong negative relationship between office size and payment rates which is not present in the data rather the data appear more consistent with a model in which there are internal nonpecuniary costs associated with stealing the bagels and donuts i e people overwhelmingly pay for the products because it would be wrong not to do so the observed payment rates are systematically related to a variety of observable factors for instance payment rates fall in response to increases in the posted price this is consistent with the increase in financial costs pushing some marginal consumers to be willing to sustain the moral cost associated with not stealing the goods or paying less than full price payment rates are higher when many of the bagels and donuts go uneaten suggesting that the marginal consumer pays a lower share of the posted price than the inframarginal consumer purchasers of donuts appear to be more likely to pay less than the full price there is a sharp and persistent increase in the payment rate following the september 11 terrorist attacks

pinocchio s pupil using eyetracking and pupil dilation to understand truth telling and deception in sender receiver games we conduct laboratory experiments on sender receiver games with an incentive for senders to exaggerate such as security analyst s painting a rosy picture about earnings prospects our results show that overcommunicati on messages are more informative of the true state than they should be in equilibri um is consistent with a level k model eyetracking shows that senders look much more on the payoff rows corresponding to the true state and much less at receiver payoffs than at their own payoffs senders pupils also dilate more when their deception is larger in magnitude together these data are consistent with the hypothesis that figuring out ho w to deceive another player is cognitively difficult as assumed in the level k mod el a combination of sender messages and lookup patterns predicts the true state about t wice as often as predicted by equilibrium using these measures would enable receiver subjects to hypothetically earn up to 16 21 percent more than they actually do

the labor market return to academic fraud abstract academic fraud by undergraduate students is pervasive but should it be taken seriously as an economic problem our research suggests so using a unique data set from the caucasus we estimate a large positive effect of academic fraud on the probability of employment econometrically we deal with endogenous selection into academic fraud and possible measurement error in the reporting of academic fraud using partial identification techniques the findings demonstrate that incentives to commit academic fraud are strong and point towards the potentially damaging consequences of academic fraud in broader settings

safety culture in financial trading an analysis of trading misconduct investigations high profile failures in financial trading have led to interest in how the culture of the industry produces risky and unethical behaviours among traders yet there is no established theoretical framework for studying this we apply safety culture theory to examine ten recent high profile trading mishaps investigated by the uk financial regulator the results show that the dimensions of safety culture e g management commitment to safety systems and procedures used to understand organisational accidents in domains such as aviation also explain failures in risk management within financial trading organisations this counters narratives focusing on traders who are unethical rule breakers and emphasises the value of a systemic approach whereby safety culture theory is used to explain why risky behaviours in financial trading occur safety culture therefore provides a conceptual basis for further research on risky and unethical behaviours in financial trading alongside providing insights for possible intervention

peers at work we study peer effects in the workplace specifically we investigate whether how and why the productivity of a worker depends on the productivity of coworkers in the same team using high frequency data on worker productivity from a large supermarket chain we find strong evidence of positive productiv ity spillovers from the introduction of highly productive personnel into a shift worker effort is positively related to the productivity of workers who see him but not workers who do not see him additionally workers respond more to the presence of coworkers with whom they frequently interact we conclude that social pressure can partially internalize free riding externalities that are built into many workplaces jel j24 l81 m54

can indifference make the world greener we test whether people s tendency to stick with the default option can help save resources in a natural field experiment we switch printers default settings from simplex to duplex printing at a large swedish university the results confirm that roughly one third of all printing is determined by the default alternative and hence daily paper consumption drops by 15 percent due to the change the effect is immediate lasts throughout the experimental period and remains intact after six months we also investigate how the more conventional method of encouraging people to save resources performs and find it has no impact recent theoretical and empirical contributions indicate that the default effect works through recommendation depends positively on the number of alternatives in the choice set and is reinforced for difficult decisions we demonstrate that the default option matter in a simple non dynamic decision task with only two alternatives and where people have been explicitly informed about the recommended course of action

honest on mondays honesty and the temporal separation between decisions and payoffs abstract we show that temporally distancing the decision task from the payment of the reward increases honest behavior each of 427 israeli soldiers fulfilling their mandatory military service rolled a six sided die in private and reported the outcome to the unit s cadet coordinator for every point reported the soldier received an additional half hour early release from the army base on thursday afternoon soldiers who participated on sunday the first work day of the week are significantly more honest than those who participated later in the week we derive practical implications for eliciting honesty

statistical evidence about libor manipulation a sherlock holmes investigation this paper contributes to the crucial problem of libor malfunctioning due to its manipulation by banks a phenomenon described clearly in the fsa inquiry report published in september 2012 after applying classical tests of non stationarity to a series of participating banks libor quotes we detected some significant breaks in the data that correspond to significant economic events namely lehman brothers bankruptcy or central banks decisions our conclusion is that a possible manipulation confirmed ex post in the fsa report can be deduced throughout the crisis period as a result of the behavior of the coefficients in a linear three regime threshold regression model finally we applied an original procedure to detect those banks most likely to build cartels or at least homogeneous groups during the important period of turmoil under review namely august 2007 through november 2012 this method called hierarchical clustering analysis helped us to precise the conclusions of the abovementioned fsa inquiry

margin call using film to explore behavioural aspects of the financial crisis the aim of this article is to show how the critically acclaimed and award winning film margin call may be used in business ethics teaching set in a fictional investment bank at the dawn of the financial crisis the film zooms in on the motivations and decision making of people who had much to lose from the crash of the hitherto very profitable mortgage backed securities market the film offers rich material for analysis of behaviours that contributed to the crisis the article will set out topics for classroom discussion including the impact of incentives and power structures contextual factors that distance people from the consequences of their actions and considerations of how the banking industry may be transformed

the long run relationship between public consumption and output in developing countries evidence from panel data abstract this paper uses heterogeneous panel cointegration techniques to examine the long run effect of public consumption on output for 33 low and lower middle income developing countries from 1972 to 2014 we include total investment in the cointegration relation and explicitly deal with cross sectional dependence in the data that arises due to unobserved common factors we find that on average government consumption has a negative impact on output in the long run a result driven by non sub saharan african countries in our sample in contrast investment has a consistent positive effect on output the results suggest that fiscal adjustments that cut government consumption while maintaining investment spending will have a potential expansionary effect on long run output

is there a cultural component in tax morale evidence from immigrants in europe abstract in this paper we examine the existence of a cultural component in individual tax morale to identify the effect of culture we use immigrant data drawn from the european social survey we find that culture is a significant determinant of tax morale the level of tax morale in the country of immigrant origin influences individual tax morale in the destination country the result is robust to the inclusion of a wide set of individual and aggregate controls and persists across different population segments

lying to level the playing field why people may dishonestly help or hurt others to create equity unethical and dishonest behavior has increasingly attracted the attention of scholars from various disciplines recent work has begun to focus on a previous overlooked factor predicting dishonest behavior the beneficiary or victim of dishonest acts in two laboratory experiments we manipulate the level of resources allocated to our participants their wealth and investigate whether perceived inequity from wealth that is randomly or subjectively assigned leads individuals to cross ethical boundaries through helping or hurting others the results show that dishonest behavior is influenced by positive and negative inequity that motivates helping and hurting acts furthermore a third experiment shows that people tend to discount the wrongness of crossing ethical boundaries to hurt or help others when the action restores equity

measuring lying aversion abstract we introduce a new method for measuring the decision to lie in experiments in the game the decision to lie increases own payment independent of the counterpart s decision but potentially at a cost for the counterpart we identify at the individual level the decision to lie and measure how individuals react to different incentives to lie furthermore we investigate how lying behavior changes over time our method allows us to classify people into types including those who never lie those who always lie and those who react to incentives to lie we suggest this method as a useful instrument for examining factors that influence the decision to lie

honesty on the streets a field study on newspaper purchasing many publishers use an honor system for selling newspapers in the street we conducted a field experiment to study honesty in this market finding that a moral reminder increases the level of honesty in payments whereas the same message has no effect on whether one is honest reminding customers of the legal norm has no effect we argue that these results are consistent with a preference for honesty based on an internalized social norm auxiliary evidence suggests that the moral message remains effective when it is posted for longer periods and even when it is removed again authors abstract

motivation money prestige and cheats a b s t r a c t this paper investigates the effects of supervision and incentives on subjects performance and cheating behavior in a real effort task with a sample of 540 participants in three differ ent experiments we investigated the interaction between motivation and monetary and social rewards with and without supervision our results suggest 1 lack of supervision promotes cheating though workers tend to cheat moderately 2 both economic and social incentives increase motivation but only when workers like their jobs 3 workers do not increase their band of acceptable dishonest behavior for possible economic rewards but they do increase dishonest behavior for possible social rewards like prestige

loss aversion and lying behavior abstract we theoretically show that loss averse agents are more likely to lie to avoid receiving a low payoff after a random draw the lower the ex ante probability of this bad outcome the ex ante expected payoff increases as the bad outcome becomes less likely and hence the greater is the loss avoided by lying we demonstrate robust support for this theory by reanalyzing the results from the extant literature and with a new experiment that varies the outcome probabilities and is run double anonymous

whale watching on the trading floor unravelling collusive rogue trading in banks recent history reveals a series of rogue traders jeopardizing their employers assets and reputation there have been instances of unauthorized acting in concert between traders their supervisors and or firms decision makers and executives resulting in collusive rogue trading we explore organizational misbehaviour theory and explain three major collusive rogue trading events at national australia bank jpmorgan with its london whale and the interest reference rate manipulation libor scandal through a descriptive model of organizational structural individual and group forces our model draws conclusions on how banks can set up behavioural risk management and internal control frameworks to mitigate potential collusive rogue trading

honesty and evasion in the tax compliance game conventional models of tax compliance emphasize that taxpayers make strategic tax reports underreporting income to the extent that this behavior is functionally rewarded in contrast to this view considerable empirical evidence suggests that many taxpayers are inherently honest reporting truthfully regardless of the incentive to cheat in this article we build a game theoretic model of tax compliance that includes both honest and potentially dishonest taxpayers we show that including honest taxpayers significantly alters the model leading to much improved empirical predictions and somewhat different and novel policy implications

the global financial crisis and the values of professionals in finance an empirical analysis the idea that the ethical values of professionals in finance pifs e g stockbrokers and fund managers have played a role in the global financial crisis gfc is widespread the crisis of ethics debate is important concerning one of the main policy challenges of our times but is based on popular lore and anecdotes rather than systematic evidence we analyze the self enhancement and self transcendence values of pifs vis a vis the general population and test for patterns of variation that are consistent with the idea of a crisis of values meaning patterns of variation that would implicate pifs values in the gfc employing pre crisis data allows for an unbiased assessment results reveal only minor differences in values between pifs and the general population too small to support the idea of a crisis of ethical values by objective standards extensive robustness checks confirm these findings sometimes actually revealing values differences counter to the crisis of ethical values idea we conclude that the financial system would not have fared better had we had a different breed of pifs rather situational forces can induce severe disregard for the welfare of others also in people with ordinary decent values hence if anything the gfc shows that the financial services industry has been providing an environment highly conducive to unethical behavior the practical implication is that fixes to the financial system can only come from improved regulatory design

on the merit of equal pay performance manipulation and incentive setting abstract work performance is often difficult to assess thus leaving room for manipulation of commonly used metrics we created a laboratory workplace in which we can precisely assess both work performance along with manipulation activities using two independent experiments we show that whenever pay for performance is used manipulation is pervasive leading to both a waste of organizational resources and a weakening of incentives by contrast paying organizational members equally effectively deters manipulation attempts leading to higher organizational production

why do people keep their promises an experimental test of two explanations numerous psychological and economic experiments have shown that the exchange of promises greatly enhances cooperative behavior in experimental games this paper seeks to test two theories to explain this effect the first posits that individuals have a preference for keeping their word the second assumes that people dislike letting down others payoff expectations according to the latter account promises affect behavior only indirectly because they lead to changes in the payoff expectations attributed to others i conduct an experiment designed to distinguish between and test these alternative explanations the results demonstrate that the effects of promises cannot be accounted for by changes in payoff expectations this suggests that people have a preference for promise keeping per se

license to cheat voluntary regulation and ethical behavior although monitoring and regulation can be used to combat socially costly unethical conduct their intended targets can often avoid regulation or hide their behavior this surrenders at least part of the effectiveness of regulatory policies to firms and individuals decisions to voluntarily submit to regulation we study individuals decisions to avoid monitoring or regulation and thus enhance their ability to engage in unethical conduct we conduct a laboratory experiment in which participants engage in a competitive task and can decide between having the opportunity to misreport their performance or having their performance verified by an external monitor to study the effect of social factors on the willingness to be subject to monitoring we vary whether participants make this decision simultaneously with others or sequentially as well as whether the decision is private or public our results show that the opportunity to avoid being submitted to regulation produces more unethical conduct than situati

tax me if you can an artifactual field experiment on dishonesty in this paper we test whether increased salience of a tax charge increases dishonesty using a version of the die under cup paradigm participants earn money in proportion to the outcome reported and thus have an incentive to over report we find a significant increase in high outcomes in the presence of a tax frame suggesting that participants use the tax as an excuse to rationalize their dishonest act in addition we tested whether adding an explanation for the adoption of the tax would increase honesty we find evidence for reversed dishonesty with participants reporting significantly more low outcomes these results warn policy makers about the non trivial relationship between taxation charges and dishonesty

context dependent cheating experimental evidence from 16 countries policy makers use several international indices that characterize countries according to the quality of their institutions however no effort has been made to study how the honesty of citizens varies across countries this paper explores the honesty among citizens across 16 countries with 1440 participants we employ a very simple task where participants face a trade off between the joy of eating a fine chocolate and the disutility of having a threatened self concept because of lying despite the incentives to cheat we find that individuals are mostly honest further international indices that are indicative of institutional honesty are completely uncorrelated with citizens honesty for our sample countries

the long run relationship between outward fdi and domestic output evidence from panel data abstract we find for 14 industrialized countries over the period 1971 2005 that outward fdi has positive long run effects on domestic output our results suggest that increased outward fdi is both a cause and a consequence of increased domestic output

the paper work of medicine understanding international medical costs this paper draws on international evidence on medical spending to examine what the united states can learn about making its healthcare system more efficient we focus primarily on understanding contemporaneous differences in the level of spending generally from the 2000s medical spending differs across countries either because the price of services differs for example a coronary bypass surgery operation may cost more in the united states than in other countries or because people receive more services in some countries than in others for example more bypass surgery operations within the price category there are two further issues whether factors earn different returns across countries and whether more clinical or administrative personnel are required to deliver the same care in different countries we first present the results of a decomposition of healthcare spending along these lines in the united states and in canada we then delve into each component in more detail administrative costs factor prices and the provision of care received bringing in a broader range of international evidence when possible finally we touch upon the organization of primary and chronic disease care and discuss possible gains in that area

why do we lie a practical guide to the dishonesty literature over the last decade a massive body of research has been devoted to uncovering human dishonesty in the present paper we review more than a hundred papers from this literature and provide a comprehensive overview by first listing the existing theoretical frameworks and then covering the common empirical approaches synthesizing the demographic and personal characteristics of those who cheat identifying the behavioural mechanisms found that affect dishonesty and finally we finish by discussing how the empirical evidence fit theory overall the review concludes that many people behave dishonestly but also that it is a highly malleable behavior sensitive to elements such as decision contexts behaviour of others state of mind and depletion the review can be used as an overview of the dishonesty literature or as a guide or work of reference for selected topics of interest

ownership organization and private firms efficient use of resources the principal agent theory asserts that public firms performance is driven by efficient capital and labor markets but is silent about non listed private companies which are less permeable to market forces both capital and labor than are public companies we propose and test a 2 x 2 framework distinguishing owner controlled vs agent led firms from firms with a flat vs multilayer organization our findings provide highly contrasted results and raise important issues for further study of private firms

strategic risk taking propensity the role of ethical climate and marketing output control in the wake of the current financial crises triggered by risky mortgage backed securities the question of ethics and risk taking is once again at the front and center for both practitioners and academics although risk taking is considered an integral part of strategic decision making sometimes firms could be propelled to take risks driven by reasons other than calculated strategic choices the authors argue that a firm s risk taking propensity is impacted by its ethical climate egoistic or benevolent and its emphasis on output control to manage its marketing function the firm s long term orientation is argued to moderate the control risk propensity relationship the authors also extend research on risk and performance and argue that the association of risk taking propensity and firm performance is contingent on the ownership publicly traded versus privately held structure of the firm based on survey data from a sample of manufacturing industries in the united states the results show significant impact of ethical climate and marketing output control on a firm s risk taking propensity also risk taking propensity shows a stronger association with firm performance in privately held firms than in publicly traded firms

auditing claims in the insurance market with fraud the credibility issue abstract this paper characterizes the equilibrium of an insurance market where opportunist policyholders may file fraudulent claims we assume that insurance policies are traded in a competitive market where insurers cannot distinguish honest policyholders from opportunists the insurer policyholder relationship is modelled as an incomplete information game in which the insurer decides to audit or not the market equilibrium depends on whether insurers can credibly commit or not to their audit strategies we show that a no commitment equilibrium results in a welfare loss for honest individuals which may even be so large that the insurance market completely shuts down we also show that transferring monitoring costs to a budget balanced common agency would mitigate the commitment problem

corruption and culture an experimental analysis article i nfo article history why do some people choose corruption over honesty and others not do the social norms and values prevailing in the societies in which they grew up affect their decisions in 2005 we conducted a bribery experiment and found that among undergraduates we could predict who would act corruptly with reference to the level of corruption in their home country among graduate students we could not in 2007 we replicated our result and also found that time spent in the uk was associated with a decline in the propensity to bribe although this does not explain our inability to predict graduate behaviour we conclude that while corruption may in part be a cultural phenomenon individuals should not be prejudged with reference to their country of origin

deception the role of uncertain consequences abstract we study how decisions to lie extend to risky environments we provide experimental evidence from a sender receiver game where there is uncertainty over the amount by which a sender s lie reduces its receiver s payoff which is known only to potential liar even though all reduction amounts are equiprobable ex post beliefs elicited from senders suggest that unlike truth tellers most liars underestimate the extent of the actual reduction in the receiver s payoff and appear to exploit this self serving bias resulting in substantially more lying relative to a baseline treatment without the uncertainty subsequent treatments confirm the bias by either providing additional evidence or by removing possible confounds an intervention treatment nudging senders toward correcting the bias reduces lying

organizational culture in the financial sector evidence from a cross industry analysis of employee personal values and career success we assess the organizational culture in the finance industry in relation to the global financial crisis gfc and consider the potential of cultural change to improve the financial sector to avoid response biases we build on the person organization p o fit literature and develop a novel indirect method for assessing organizational culture that revolves around relationships between employees personal traits and their career success in the industry or organization under study we analyze personal values concerning the pursuit of private gain self enhancement values versus personal values concerning caring for others self transcendence values and consider whether employees that value self enhancement more and self transcendence less enjoy more career success relative to their peers when working in finance than when working in other industries results do not reveal any sort of cross industry differences that would implicate the finance industry s culture in the financial crisis instead we find the opposite namely that strong self enhancement values and weak self transcendence values go together with less career success in the finance industry compared to other industries hence if anything the culture in the finance industry does not seem to resonate well with professionals that seek to pursue personal gain at the expense of clients welfare implication is that cultural change has little potential to improve the financial system meanwhile the method for assessing organizational culture indirectly by analyzing relationships between employees traits and their career outcomes has wider applicability particularly when relying on scores or measures obtained directly from the people concerned is likely to render biased evidence

testing a causal model of corporate risk taking and performance the determinants of organizational risk taking and its impact on economic performance are critical issues in strategic management using a model that included risk performance performance expecta

the aversion to lying abstract we experimentally investigate the effect of cheap talk in a bargaining game with one sided asymmetric information a seller has private information about her skill and is provided an opportunity to communicate this information to a buyer through a written message four different treatments are compared one without communication one with free form communication and two treatments with pre specified communication in the form of promises of varying strength our results suggest that individuals have an aversion towards lying about private information and that the aversion to lying increases with the size of the lie and the strength of the promise freely formulated messages lead to the fewest lies and the most efficient outcomes