Whistle-Blower Protection: Theory and Experimental Evidence
Whistle-blowing by employees plays a major role in uncovering corporate fraud. Various recent laws aim at improving protection of whistle-blowers and enhancing their willingness to report. Evidence on the effectiveness of such legislation is, however, scarce. Moreover, critics have raised worries about fraudulent claims by low-productivity employees. We study these issues in a theory-guided lab experiment. Easily attainable ("belief-based") protection indeed leads to more reports, both truthful and fraudulent. Fraudulent claims dilute prosecutors' incentives to investigate, and thereby hamper deterrence. These effects are ameliorated under more stringent ("fact-based") protection.
|Date of creation:||Mar 2017|
|Contact details of provider:|| Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany|
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Schmidt, Matthias, 2005. ""Whistle Blowing" Regulation and Accounting Standards Enforcement in Germany and Europe--An Economic Perspective," International Review of Law and Economics, Elsevier, vol. 25(2), pages 143-168, June.
- Uri Gneezy & Stephan Meier & Pedro Rey-Biel, 2011. "When and Why Incentives (Don't) Work to Modify Behavior," Journal of Economic Perspectives, American Economic Association, vol. 25(4), pages 191-210, Fall.
- Alekseev, Aleksandr & Charness, Gary & Gneezy, Uri, 2017. "Experimental methods: When and why contextual instructions are important," Journal of Economic Behavior & Organization, Elsevier, vol. 134(C), pages 48-59.
- Steven Kaplan & Joseph Schultz, 2007. "Intentions to Report Questionable Acts: An Examination of the Influence of Anonymous Reporting Channel, Internal Audit Quality, and Setting," Journal of Business Ethics, Springer, vol. 71(2), pages 109-124, March.
- Guido Friebel & Michael Raith, 2004. "Abuse of Authority and Hierarchical Communication," RAND Journal of Economics, The RAND Corporation, vol. 35(2), pages 224-244, Summer.
- Marcia Miceli & Janet Near & Terry Dworkin, 2009. "A Word to the Wise: How Managers and Policy-Makers can Encourage Employees to Report Wrongdoing," Journal of Business Ethics, Springer, vol. 86(3), pages 379-396, May.
- Abigail Barr & Danila Serra, 2009.
"The effects of externalities and framing on bribery in a petty corruption experiment,"
Springer;Economic Science Association, vol. 12(4), pages 488-503, December.
- Abigail Barr & Danila Serra, 2008. "The effects of externalities and framing on bribery in a petty corruption experiment," CSAE Working Paper Series 2008-24, Centre for the Study of African Economies, University of Oxford.
- Yasuyo Hamaguchi & Toshiji Kawagoe, 2005. "An Experimental Study of Leniency Programs," Discussion papers 05003, Research Institute of Economy, Trade and Industry (RIETI).
- Sandeep Kapur, 2009. "An Economic Model of Whistle-Blower Policy," Journal of Law, Economics and Organization, Oxford University Press, vol. 25(1), pages 157-182, May. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp10607. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.