IDEAS home Printed from https://ideas.repec.org/p/iim/iimawp/13315.html
   My bibliography  Save this paper

The Impact of Psychological Traits on Judgments Related to Ethics

Author

Listed:
  • Agarwalla, Sobhesh Kumar
  • Desai, Naman
  • Tripathy, Arindam

Abstract

This paper examines how two contradictory psychological traits, self-deception (SD) and professional skepticism (PS), affect managers and auditors assessments of the ethicality of various earnings management choices. Whereas, self-deception allows individuals to reduce cognitive dissonance (Festinger 1957) arising from their self-serving behavior which could be unethical (Audi 1988; Sanford 1988), professional skepticism or trait skepticism (Hurtt 2010) would force individuals to question such self-serving behavior and, as a result, could make them less likely to act unethically. The results indicate that SD, PS and participant type (Chartered Accountant (CA) versus Manager) had a significant effect on the ethicality ratings. Managers exhibiting high (low) SD and low (high) PS view the earnings management techniques that were generally considered to be unethical, as relatively more (less) ethical. For CAs, the SD and PS scores are not significantly related to their ethicality ratings. This result appears to be driven by the fact that CAs tend to have greater exposure information that emphasizes ethics such as their standards and education and hence psychological traits did not affect their ethicality ratings.

Suggested Citation

  • Agarwalla, Sobhesh Kumar & Desai, Naman & Tripathy, Arindam, 2015. "The Impact of Psychological Traits on Judgments Related to Ethics," IIMA Working Papers WP2015-03-08, Indian Institute of Management Ahmedabad, Research and Publication Department.
    • Handle: RePEc:iim:iimawp:13315
    as

    Download full text from publisher

    File URL: https://www.iima.ac.in/sites/default/files/rnpfiles/8684334682015-03-08.pdf
    File Function: English Version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Ford, Gary T & Smith, Darlene B & Swasy, John L, 1990. "Consumer Skepticism of Advertising Claims: Testing Hypotheses from Economics of Information," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 16(4), pages 433-441, March.
    2. Stelios Zyglidopoulos & Peter Fleming & Sandra Rothenberg, 2009. "Rationalization, Overcompensation and the Escalation of Corruption in Organizations," Journal of Business Ethics, Springer, vol. 84(1), pages 65-73, January.
    3. Boush, David M & Friestad, Marian & Rose, Gregory M, 1994. "Adolescent Skepticism toward TV Advertising and Knowledge of Advertiser Tactics," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 21(1), pages 165-175, June.
    4. Pamela Murphy & M. Dacin, 2011. "Psychological Pathways to Fraud: Understanding and Preventing Fraud in Organizations," Journal of Business Ethics, Springer, vol. 101(4), pages 601-618, July.
    5. Merchant, Kenneth A. & Rockness, Joanne, 1994. "The ethics of managing earnings: An empirical investigation," Journal of Accounting and Public Policy, Elsevier, vol. 13(1), pages 79-94.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Agarwalla, Sobhesh Kumar & Desai, Naman & Tripathy, Arindam, 2017. "The impact of self-deception and professional skepticism on perceptions of ethicality," Advances in accounting, Elsevier, vol. 37(C), pages 85-93.
    2. Christian Hauser, 2019. "Fighting Against Corruption: Does Anti-corruption Training Make Any Difference?," Journal of Business Ethics, Springer, vol. 159(1), pages 281-299, September.
    3. Becker-Olsen, Karen L. & Cudmore, B. Andrew & Hill, Ronald Paul, 2006. "The impact of perceived corporate social responsibility on consumer behavior," Journal of Business Research, Elsevier, vol. 59(1), pages 46-53, January.
    4. Thakor, Mrugank V. & Goneau-Lessard, Karine, 2009. "Development of a scale to measure skepticism of social advertising among adolescents," Journal of Business Research, Elsevier, vol. 62(12), pages 1342-1349, December.
    5. Lunardo, Renaud, 2012. "Negative effects of ambient scents on consumers’ skepticism about retailer’s motives," Journal of Retailing and Consumer Services, Elsevier, vol. 19(2), pages 179-185.
    6. Serife YAZGAN PEKTAS & Azize HASSAN, 2020. "The Effect of Digital Content Marketing on Tourists’ Purchase Intention," Journal of Tourismology, Istanbul University, Faculty of Economics, vol. 6(1), pages 79-98, June.
    7. Denise Fleck & Roger J. Volkema & Sergio Pereira, 2016. "Dancing on the Slippery Slope: The Effects of Appropriate Versus Inappropriate Competitive Tactics on Negotiation Process and Outcome," Group Decision and Negotiation, Springer, vol. 25(5), pages 873-899, September.
    8. Grier, Sonya A. & Forehand, Mark R., 2002. "When Is Honesty The Best Policy? The Effect of Stated Company Intent on Consumer Skepticism," Research Papers 1665r, Stanford University, Graduate School of Business.
    9. Cho, Yoon-Na & Taylor, Charles R., 2020. "The role of ambiguity and skepticism in the effectiveness of sustainability labeling," Journal of Business Research, Elsevier, vol. 120(C), pages 379-388.
    10. W. Robert Knechel & Natalia Mintchik, 2022. "Do Personal Beliefs and Values Affect an Individual’s “Fraud Tolerance”? Evidence from the World Values Survey," Journal of Business Ethics, Springer, vol. 177(2), pages 463-489, May.
    11. Suresh Malodia & Alka Singh Bhatt, 2019. "Why Should I Switch Off: Understanding the Barriers to Sustainable Consumption?," Vision, , vol. 23(2), pages 134-143, June.
    12. Muel Kaptein, 2023. "A Paradox of Ethics: Why People in Good Organizations do Bad Things," Journal of Business Ethics, Springer, vol. 184(1), pages 297-316, April.
    13. Lamar Pierce & Jason Snyder, 2015. "Unethical Demand and Employee Turnover," Journal of Business Ethics, Springer, vol. 131(4), pages 853-869, November.
    14. Balaciu Diana Elisabeta & Vladu Alina Beattrice, 2010. "Creative Accounting - Players And Their Gains And Loses," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(2), pages 813-819, December.
    15. Suwelack, Thomas & Hogreve, Jens & Hoyer, Wayne D., 2011. "Understanding Money-Back Guarantees: Cognitive, Affective, and Behavioral Outcomes," Journal of Retailing, Elsevier, vol. 87(4), pages 462-478.
    16. Jong Yoon Lee & Jae Hee Park & Jong Woo Jun, 2019. "Brand Webtoon as Sustainable Advertising in Korean Consumers: A Focus on Hierarchical Relationships," Sustainability, MDPI, vol. 11(5), pages 1-10, March.
    17. Skarmeas, Dionysis & Leonidou, Constantinos N., 2013. "When consumers doubt, Watch out! The role of CSR skepticism," Journal of Business Research, Elsevier, vol. 66(10), pages 1831-1838.
    18. Narwal, Preeti & Rai, Shivam, 2022. "Individual differences and moral disengagement in Pay-What-You-Want pricing," Journal of Business Research, Elsevier, vol. 149(C), pages 528-547.
    19. Alaa Mansour Zalata & Collins Ntim & Ahmed Aboud & Ernest Gyapong, 2019. "Female CEOs and Core Earnings Quality: New Evidence on the Ethics Versus Risk-Aversion Puzzle," Journal of Business Ethics, Springer, vol. 160(2), pages 515-534, December.
    20. Nadia Smaili & Paulina Arroyo, 2019. "Categorization of Whistleblowers Using the Whistleblowing Triangle," Journal of Business Ethics, Springer, vol. 157(1), pages 95-117, June.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iim:iimawp:13315. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/eciimin.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.