KANT

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KANTS CATEGORICAL IMPERATIVE

• UNIVERSAL PRINCIPLE
• A person should act that the principle of ones
  act could become a universal law of human action
  in a world in which one would hope to live.
• A person should treat other people as having
  intrinsic value, and not merely as a means to
  achieve ones end.

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CONTRACTARIAN DEONTOLOGY

• John Locke
• Each individual has inalienable natural rights.
  The purpose of society is to protect these rights
• Rawls (Veil of Ignorance)
• Social Justice is created when rational people
  would formulate rights if they did not know
  whether or not these principles would apply to
  them.

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CRITICAL QUESTIONS?

• DO ALL HUMANS HAVE POTENTIAL FOR GREATNESS?
• WHAT ARE SOME OF THESE POTENTIALITIES?
• ARE PEOPLE SOCIAL BY NATURE?

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HUMAN NATURE ETHICS

• ARISTOTLE
• All humans share innate capacities and desires.
  All Humans are social creatures and therefore
  have the capacity to become excellent members of
  society. This is done by studying, becoming wise
  and participating in politics.
• Negative behavior is a result of not being
  allowed to reach full potential

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BUSINESS ETHICS AND ECONOMIC SENSE

• Adam Smith
• The Wealth of Nations
• It is not from the benevolence of the butcher,
  the brewer,or the baker that we expect out
  dinner, but from their own interest. We address
  not heir humanity but their self-love

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ADAM SMITH INThe Theory of Moral Sentiments

• There is a need to go beyond profit maximization
  to humanity, justice, generosity, and public
  spirit.

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ECONOMIC INSTITUTIONSFOUNDATIONS

• Common Behavior Patterns
• Shared Trusts
• Mutual Confidence

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OTHER FORMS OF CAPITALISM

• Japanese Ethos
• Honor
• Duty
• Confucian
• Hard Work
• Thrift
• Family

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Public Good

• All Benefit
• Non-Competitive
• Ones Consumption does not exclude another
• EXTERNALITIES
• Public Ownership
• Public Regulation
• Public Concern in Private Decisions

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CRITICAL QUESTIONS?

• WHAT IS TRUTH?
• WHAT IS A LIE?

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TRUTHFULNESSEmmanuel Kant 1771

• TRUTH TELLING LEADS TO
• DISCOURSE WHICH LEADS TO
• FELLOWSHIP WHICH LEADS TO
• FORMATION OF A SOCIETY

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GENERALLY TO LIE IS EVIL AND TO BE A LIAR IS TO
BE A COWARD

• SILENCE
• Not an option because it is view as unsocial
• SECRETS
• Telling secrets is like giving presents and a
  nature inclination. Strength is in keeping them.
• TRUTH
• Important because one of two way to gain
  knowledge. The other is experience.

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• LIE
• When giving impression that you are telling the
  truth
• FALSE STATEMENTS OK WHEN
• Other person does not have the right to demand
  the truth
• Other person may make wrong use of the truth
• Other person may harm you
• FLATTERY
• Can be act of kindness (weakness) or treachery
• FAULT FINDING
• OK for someone in authority when used with love,
  goodwill, or sweetness
• SPYING
• We have no right to spy on others
• ANY ACT THAT WORKS AGAINST FRANKNESS LOWERS THE
  DIGNITY OF HUMAN KIND

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CRITICAL QUESTIONS?

• IS IT APPROPRIATE FOR BUSINESS TO HAVE ITS OWN
  ETHICAL RULES?

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Is Business Bluffing Ethical?Albert Carr (1968)

• BUSINESS IS A GAME WITH ITS OWN ETHICS
• FALSEHOOD IS NOT FALSHOOD WHEN TRUTH IS NOT
  EXPECTED BY THE OTHER SIDE
• THE GAME PRESSURES PEOPLE TO DECEIVE. DECEPTION
  MUST BE WITHIN LIMITS OF THE RULES OF THE GAME
  (LAW)

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• ETHICS ARE OF VALUE WHEN THEY ADD VALUE TO THE
  BUSINESS
• TO WIN ONE MUST PLAY TO WIN
• THERE ARE BOUNDARIES TO BEHAVIORS AND DEFINITIONS
  OF HONESTY, INTEGRITY AND DECENCY WITH THE GAME.

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CRITICAL QUESTIONS?

• WHAT ARE THE BASIC SETTLED ETHICS IN BUSINESS
  DEALINGS?
• WHAT ROLE SHOULD GOVERNMENT (POLITICS PLAY)?

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LIMITS OF BUSINESS ETHICSJoseph Betz (1999)

• INFORMAL
• You may do unto others what experience teaches us
  they might do to us.
• FORMAL
• Law

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BUSINESS AND LAW

• SINCE THE ETHICAL BAR IS SO LOW, SOCIETY MUST
  CONSTANTLY WRITE LAWS REGULATING BUSINESS.

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CRITICAL QUESTIONS?

• How much should you trust another in business
  negotiation?
• Is the market place established as a place to
  deceive others?

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Promoting Honesty in NegotiationsCramton Dees

• Foundation Theory
• Most people place a high value on their own
  welfare
• There is weakness in all of us
• Others will behave ethically only if they expect
  others to do the same

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NEGOTIATION

• FALSE IMPRESSIONS
• PRIVILEDGED ACCESS TO INFORMATION
• USE OF THREATS AND PROMISES
• UNDISCLOSED SETTLEMENT PREFERENCES

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Factors Affecting Honesty

• Asymmetry of Information
• Verification is Difficult
• Intention to Deceive is difficult to establish
• Insufficient resources
• Interaction is infrequent

• Ex Post redress is costly
• Reputation information not available
• Unique circumstances
• To much to lose to be honest

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LIMITING DECEPTION

• VERIFY CLAIMS
• DEVELOP CONTRACTS (Warranties/ Bonds/ \Escrow)
• PRESERVATION OF REPUTATION
• LIMIT MORAL HAZARDS (Shirking Responsibilities)

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REAL WORLD LIMITS

• Legal and Regulatory Protection
• Institutional Verification Available
• Standard Contracts
• Third Party Negotiators
• Credentials Individuals Available

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PREPARING FOR NEGOTIATIONS

• Determine incentives for deception
• Determine character of other side
• Determine your attitudes toward issues and others

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BUILDING TRUST

• Face to Face Contact
• Create opportunities to display trust
• Demonstrate your trustworthiness
• Place negotiations in long term context
• Bring in trusted intermediaries
• Self Protection