Deck 23: Behavioral Ethics, Individuals, and Management

Question 1

Behavioral ethics approaches moral issues through fundamental moral principles such as Kant's categorical imperative and the utilitarian principle of maximizing aggregate well-being.

Answer 1

False

Question 2

It is usually less difficult to develop trust and reciprocity with stakeholders that have irregular interactions with the firm.

Answer 2

False

Question 3

Behavioral ethics experiments conclude that socialization through the sharing of information about how others behave can strengthen a reciprocity norm.

Answer 3

True

Question 4

Reciprocity has implications for dealing with direct stakeholders and for the implementation and maintenance of relational contracts.

Question 5

Greater scrutiny by NGOs and social activists strengthen the audience effects, giving firms incentives to be more socially responsible.

Question 6

Behavioral ethics experiments suggest that relational contracts supported by reciprocity are unlikely to be effective in improving the performance of workers and firms.

Question 7

Behavioral ethics experiments conclude that greater social distance decreases the cost of acting ethically and increases the likelihood of ethical behavior.

Question 8

Behavioral ethics experiments conclude that moral suasion can decrease ethical behavior.

Question 9

Rule utilitarianism requires that a person contribute even if others do not contribute.

Question 10

An experiment is anonymous if the experimenters do not know which participants are in which roles.

Question 11

When it is clear what the implications are for stakeholders, audience effects can be weaker, and less corporate social responsibility would then be expected.

Question 12

Moral suasion cannot change the preferences of participants.

Question 13

The audience effect should be stronger the broader is the audience and the more important is the moral issue to members of the audience.

Question 14

Monitoring of the firm by stakeholders and other parties such as NGOs tends to decrease the moral cost of violating ethics standards or shying away from moral duties.

Question 15

An implication of the experimental evidence regarding audience effects is that firms that have the public and consumers as an audience may undertake activities that firms out of the view of the public and consumers may not undertake.

Question 16

A dictator game involves two participants, a proposer, who unilaterally makes a decision about how much of an endowment to keep and how much to contribute to a responder, who takes no action and simply receives the contribution.

Question 17

If the proposer earns the endowment rather than it being a windfall provided by the experimenter, self-interested behavior is much more prevalent.

Question 18

The triple bottom line is intended to measure the pressure on individuals as generated by the society.

Question 19

Transparency can reduce social distance and make it easier to develop trust and reciprocity.

Question 20

Behavioral ethics experiments conclude that the higher the cost (moral or otherwise) of acting ethically, the less likely is ethical behavior.

Question 21

Which of the following statements is true of moral suasion in behavioral ethics experiments?

A) Moral suasion serves as a coordination mechanism by increasing the confidence of participants.
B) Moral suasion cannot change the preferences of participants.
C) Participants receiving the moral messages and the message urging contributions decreased their contributions on average
D) The deterioration of contributions was steeper with the moral messages.

Question 22

Reliance on the personal integrity of employees is mostly sufficient to ensure ethical conduct, and employees should be allowed to operate in an ethics vacuum.

Question 23

If the culture in the organization encourages or condones questionable behavior or if incentive systems place self-interest before all else, ethical behavior will primarily rest on the personal integrity of employees.

Question 24

Which of the following statements is true of behavior in the context of behavioral ethics experiments?

A) The lower the cost (moral or otherwise) of acting ethically, the less likely is ethical behavior.
B) Greater social distance increases the cost of acting ethically and decreases the likelihood of ethical behavior.
C) Socialization through the sharing of information about how others behave can weaken a reciprocity norm.
D) Relational contracts enforced through two-sided reciprocity cannot be beneficial.

Question 25

Direct stakeholders are those ________.

A) who have economic transactions with the firm
B) who operate in the same region as the firm
C) who have the same kind of output as the firm
D) who command a market monopoly

Question 26

Which of the following is difficult to assess in the process of decision making by firms and managers?

A) motivation
B) environmental policies
C) workers rights
D) legal statutes

Question 27

Which of the following scenarios portrays morally motivated nonmarket action?

A) an automobile company launched a new range of low-cost environment friendly hybrid cars
B) a customer of a marketing company launched an internet campaign to raise awareness of the company's mismanagement of charity funds
C) a reputed MNC acquired a smaller company in order to diversify
D) the brand management team of a food and beverage company launched an advertisement for their new "all natural" beverage that uses 100 percent natural ingredients

Question 28

Relying only on utilitarianism and ignoring intrinsic rights or justice considerations can result in conduct that violates ethics standards that people hold to be important.

Question 29

A research experiment to understand individual choices in moral dilemmas is called ________ if the experimenters do not know which participants are in which roles.

A) treatment
B) double blind
C) anonymous
D) direct observation

Question 30

Which of the following is true of the audience effect in behavioral ethics experiments?

A) the larger the audience, the greater the audience effect
B) the greater the degree of negligence of actions, the greater the audience effect
C) the greater the anonymity of the decision maker, the stronger the scrutiny
D) the smaller the audience, the greater the importance of the audience members

Question 31

Reciprocity is powerful when ________.

A) the responder can neither accept nor reject the allocation by the proposer
B) incentives are allocated regardless of the actual effort expended to do a work
C) both parties to a transaction reciprocate
D) only one party to the transaction has the opportunity to reciprocate

Question 32

More recently, researchers have turned to ________ to try to understand how individuals make choices when facing a moral issue.

A) Laboratory experiments
B) Ethnographic research
C) Direct observation
D) Internet-based experiments

Question 33

A nuclear energy company sets up a plant in North Africa. Although, the plant will benefit the consumers with cheap energy and employment, hundreds of villagers will be displaced. The company faces growing pressure from some developed nations, NGOs, and the news media. It finally decides to relocate the villagers in the next one year through a corporate social responsibility scheme. Which of the following explains the behavior of the company?

A) altruism
B) audience effect
C) egalitarianism
D) paternalism

Question 34

Strategies and practices of a firm are revised frequently as a function of the salience of the issues in the market and nonmarket environments.

Question 35

It is more difficult to develop trust and reciprocity with stakeholders that ________.

A) have regular economic transactions with the firm
B) operate in the same region as the firm
C) are members of peak organizations
D) have only irregular interactions with the firm

Question 36

The most consistent conclusion from the experiments for ethical conduct and management in the nonmarket environment is that ________.

A) firms that allow managers to decide unilaterally and solely according to their individual preferences are more stable than those that do not
B) monitoring of firms by stakeholders and other parties tends to decrease the moral cost of violating ethics standards
C) people differ in their behavior, preferences, and moral conduct
D) transparency increases social distance

Question 37

A(n) ________ is an experiment with a specific context and set of instructions.

A) treatment
B) maxim
C) ethical dilemma
D) intrinsic right

Question 38

Organizational strategies serve as the core principles that guide the practices of the company as it strives to achieve its goals.

Question 39

Which of the following is true with regard to research findings on behavior in dictator games?

A) The source of the endowment did not affect behavior in the course of experiments.
B) People do not follow social norms in considering how to allocate the endowment.
C) Participants in the role of the proposer are rationally self-interested.
D) Most proposers chose an equal allocation of the endowment rather than a very unequal allocation favoring the proposer.

Question 40

A dictator game involves ________.

A) a self-interested proposer and a responder who receive equal endowment before making a moral decision
B) a proposer and a responder who bilaterally make a decision about how much endowment to keep and how much to contribute
C) a proposer who unilaterally makes a decision about how much endowment to keep and how much to contribute to a responder, who takes no action and simply receives the contribution
D) a responder who unilaterally makes a decision about how much endowment to keep and how much to contribute to a proposer, who takes no action

Question 41

Which of the following is used to measure corporate environmental, social, and financial performance?

A) triple bottom line
B) placebo treatment
C) Kant's categorical imperative
D) casuistry

Question 42

________ is/are revised frequently as a function of the salience of the issues in the market and nonmarket environments.

A) The vision of the organization
B) Core principles
C) Organizational values
D) Strategies and practices

Question 43

Differentiate between an unconditional and a conditional altruist.

Question 44

What are the two factors responsible for the spread of codes of ethics and statements of social responsibility in firms?

Question 45

Effective ethics policies and codes of conduct require ________.

A) employees to reveal internal information about the firm's operations to the shareholders
B) employees to report any violations
C) employees to indulge in morally motivated nonmarket actions
D) employees to trust firms unconditionally

Question 46

Write a short note on the sources of unethical behavior.

Question 47

________ serve as the core principles that guide the strategies and practices of the company as it strives to achieve its objectives.

A) Organizational objectives
B) Intrinsic rights
C) Organizational values
D) Instrumental rights

Question 48

The audience effect should be stronger ________.

A) the more conservative is the audience
B) the greater is the opacity of the situation
C) the more important is the moral issue to the members of the audience
D) the more the members of the audience identifies with the firm

Question 49

Which of the following companies would most likely feel obliged to undertake corporate social responsibility?

A) a company that manufactures industrial lighting, material handling equipment, and industrial supplies
B) a company that sells commercial furniture and furniture components
C) a biotechnology firm that is involved in industrial and environmental biotechnology products as well as research and development
D) a bank that take deposits, have branches, and interacts directly with consumers and communities

Question 50

Mark works in an automobile manufacturing firm based in Tennessee. He noticed that a group of executives in the firm regularly accepted bribes from an automotive brake manufacturer who sells substandard brakes for lower prices. Mark understands that this is unethical behavior but does not have the courage to take the right action. Which of the following actions should the firm take in this instance to encourage Mark to take the right action?

A) The firm should start manufacturing high quality brakes at lower prices.
B) The firm should revise its compliance system to encourage self-disclosure.
C) The firm should leave the responsibility of ethical behavior on the personal integrity of its employees.
D) The firm should reveal information about its operations to the shareholders.

Question 51

Discuss the implications of the ethics experiments for ethical conduct and management in the nonmarket environment.

Question 52

Statements of corporate responsibility and codes of conduct should ________.

A) encourage top management to allow an ethics vacuum within the organization
B) rely on the personal integrity of employees c indicate how to reason about situations and issues
D) encourage paternalism

Question 53

Which of the following should a firm's management do to establish an environment in which ethical behavior in encouraged, supported, and rewarded?

A) encourage formal and informal communication about exemplary conduct and leadership by deed as well as by word
B) decrease endowment substantially
C) trust the personal integrity of employees and allow them to operate in an ethics vacuum
D) encourage retributive justice to prevent self-disclosure

Question 54

What is the balance scorecard?

Question 55

The core principles of an organization can be viewed as ________.

A) flexible
B) arbitrary
C) moral
D) unchanging