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Organisational structure, communication and group ethics

  • Matthew Ellman
  • Paul Pezanis-Christou

This paper investigates experimentally how organisational decision processes affect the moral motivations of actors inside a firm that must forego profits to reduce harming a third party. In a "vertical" treatment, one insider unilaterally sets the harm-reduction strategy; the other can only accept or quit. In a "horizontal" treatment, the insiders decide by consensus. Our 2-by-2 design also controls for communication effects. In our data, communication makes vertical firms more ethical; voice appears to mitigate "responsibility-alleviation" in that subordinates with voice feel responsible for what their firms do. Vertical firms are then more ethical than the horizontal firms for which our bargaining data reveal a dynamic form of responsibility-alleviation and our chat data indicate a strong "insider-outsider" effect.

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File URL: http://research.barcelonagse.eu/tmp/working_papers/290.pdf
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Paper provided by Barcelona Graduate School of Economics in its series Working Papers with number 290.

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Date of creation: Feb 2007
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Handle: RePEc:bge:wpaper:290
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