No full-text available
To read the full-text of this research,
you can request a copy directly from the author.
Bounded Ethicality in Negotiations1
Abstract
Most negotiators think of themselves as good people, and most negotiators act in ethically questionable ways at times. How can these two descriptions be reconciled? This paper follows Bazerman and Tenbrunsel (2011) in arguing that good people often engage in unethical acts without their own awareness of doing so. This paper specifically explores how negotiators may be prejudiced, favor in-groups, and overclaim in negotiation, without knowing that they are doing anything wrong.
... What influences negotiators' decision to use deception and mislead their counterparts? Max Bazerman and his colleagues (Banaji, Bazerman, and Chugh 2003;Bazerman and Banaji 2004;Kern and Chugh 2009;Bazerman 2011;Bazerman and Tenbrunsel 2011) recently proposed that the limits of the conscious mind restrict and constrain negotiators' morality. According to this perspective, negotiators are boundedly ethical, such that (unconscious) implicit processes influence the decision to use deception in negotiation and related interpersonal contexts. ...
... Although the rational choice framework has provided the foundation for much of the research on deception and unethical behavior, more recently scholars have argued that the deception decision process reflects the influence of (unconscious) implicit processes. In research on deception, Max Bazerman and his colleagues Bazerman and Banaji 2004;Kern and Chugh 2009;Bazerman 2011;Bazerman and Tenbrunsel 2011) proposed that the limits of the conscious mind restrict and constrain the morality of negotiators. Further, in research on ethical decision making, Scott Reynolds (2006) developed a neurocognitive model that describes the dominant role of the unconscious in the ethical decision-making process (see also Reynolds, Leavitt, and DeCelles 2010). ...
... Bazerman and his colleagues Bazerman and Banaji 2004;Kern and Chugh 2009;Bazerman 2011;Bazerman and Tenbrunsel 2011) have argued that the limits of the conscious mind restrict and constrain the morality of negotiators. In this perspective, negotiators are boundedly ethical, such that (unconscious) implicit processes pervade the deception decision process in negotiation and related interpersonal contexts. ...
Deception is pervasive in negotiations, and proponents of bounded ethicality propose that the decision to use deception reflects the influence of (unconscious) implicit processes. In this article, we empirically explore the bounded ethicality perspective. In the first experiment, we found that an implicit association between business and morality interacted with the competitive and cooperative characteristics of a negotiation to influence both negotiators' attitudes toward deception and their intentions to use deception. But in a second and third experiment, we found that these did not interact to influence negotiators' actual deception decisions. The results of our studies provide important insights into the deception decision process and complicate our understanding of bounded ethicality.
... This approach suggests that people's understanding of their cognitive and affective states is crucial for making effective decisions. The Role of meta-representation in decision-making under uncertainty (Bazerman, 2011) is another important framework that has been proposed in the literature. Meta-representation, or the ability to reflect on one's own representations, has been identified as a crucial element in the strategic decision making process. ...
... This study is consistent with previous studies that have identified the presence of biases in the decisionmaking process and proposed methods to overcome them (for example, Bazerman, 2011;Nikolić, 2018;Borchardt, Kamzabek, & Lovallo, 2022). However, this study goes beyond the traditional debiasing methods that focus on the individual level and proposes designing organizations, systems, and processes to overcome biases. ...
... This latter temptation is additionally fueled by a fear of losing one's position in the negotiation (Dees and Cramton 1991;Lewicki and Stark 1996). Indeed, the use of unethical tactics is not uncommon among negotiators (Bazerman 2011;Olekalns et al. 2014). ...
... Despite the norm against unethical behavior, many negotiators deploy unethical tactics, and often benefit from doing so (Bazerman 2011;Olekalns and Smith 2007;Olekalns et al. 2014;Schweitzer et al. 2005). For example, withholding or misrepresenting information can yield an information advantage and opens the possibility of gaining information from the negotiation counterpart without revealing much yourself (Lewicki et al. 2015). ...
While organizations strive for ethical conduct, the activity of negotiating offers strong temptations to employ unethical tactics and secure benefits for one’s own party. In four experiments, we examined the role of constituency communication in terms of their attitudes towards (un)ethical and competitive conduct on negotiators’ willingness and actual use of unethical tactics. We find that the mere presence of a constituency already increased representatives’ willingness to engage in unethical behavior (Experiment 1). More specifically, a constituency communicating liberal (vs. strict) attitudes toward unethical conduct helps negotiators to justify transgressions and morally disengage from their behavior, resulting in an increased use of unethical negotiation tactics (Experiment 2–3). Moreover, constituents’ endorsement of competitive strategies sufficed to increase moral disengagement and unethical behavior of representative negotiators in a similar fashion (Experiment 4ab). Our results caution organizational practice against advocating explicit unethical and even competitive tactics by constituents: it eases negotiators’ moral dilemma towards unethical conduct.
... Employing such an informal course of relationship development, particularly probing and exploring the structural and dynamic characteristics, fosters constructive bonds, built on mutual trust (Tomlinson 2005). Furthermore, it alleviates the effects of bounded ethicality that is unintended discriminatory actions towards members of the other social categories, especially adversary group (Bazerman 2011). In the context of imbalanced intergroup power-relations the dominant (majority) party would be less inclined to exaggerate their deservingness of credit for positive outcomes and members of the less powerful (minority) party would have lower tendency to feel underestimated. ...
... Notwithstanding the contribution of positive interdependence among diverse groups to collaborative efforts in the organizational arena, as was demonstrated by the nurses' mixed teams' case and the Jewish-Arab inter-organizational environmental partnership, hidden aspects stemming from the legacies of prolonged national discord, impinge on the parties relations and pose barriers on engaging 'otherness'. The latter predicament is rooted both in universal individual obstacles such as bias blind spot, errors of third and fourth kind and bounded ethicality and construction of power by social institutions (Bazerman 2011, Desivilya Syna and Rottman 2012, Kristeva 1991, Mitroff and Silvers 2010, Schaap 2006, West et al. 2012 ). Thus, concerted actions of third parties are necessary in order to confront these largely latent difficulties to address 'otherness' in organizations, foreshadowed by deep schisms such as protracted conflicts. ...
Dr. Cassandra Ellerbe Dück: Cities across Europe are confronted more than ever with issues related to patterns of migration, housing, economic growth etc. In order to create equitable, sustainable and effective forms of urban governance, policies and measures need to emerge that employ an alternative approach. In the last decades, we have seen an increase in more integrative forms of governance in many European cities where actors from civil society organizations, NGOs, businesses etc. have cooperated with administrative bodies and exercised influence upon decision- making processes.
... To answer this question, we turn to research on decision frames, and specifically, ethical decision frames. Research on decision framing in conflict and negotiation has a long history (e.g., Bazerman, Magliozzi, and Neale 1985;Pinkley 1990;Neale and Bazerman 1992;Pinkley and Northcraft 1994;Schweitzer, DeChurch, and Gibson 2005;Shmueli, Elliott, and Kaufman 2006;Kern and Chugh 2009;Bazerman 2011;Halevy and Katz 2013;Druckman and Wagner 2021). This work investigates how people's understanding and sensemaking in situations involving conflict and negotiation affect their thoughts, feelings, behaviors, and outcomes. ...
Lawyers have broad discretion in deciding how honestly to behave when negotiating. We propose that lawyers’ choices about whether to disclose information to correct misimpressions by opposing counsel are guided by their moral character and their cognitive framing of negotiation. To investigate this possibility, we surveyed 215 lawyers from across the United States, examining the degree to which honest disclosure is associated with lawyers’ moral character and their tendency to frame negotiation in game‐like terms—a construal of negotiation that we label game framing. We hypothesize that the more that lawyers view negotiation through a game frame—that is, the more they view negotiation as an adversarial context with arbitrary and artificial rules—the less honest they will be in situations in which honest disclosure is not mandated by professional rules of conduct. We further hypothesize that lawyers with higher levels of moral character will apply a game frame to negotiation to a lesser degree than will lawyers with lower levels of moral character, and that honesty when negotiating will be higher when lawyers have higher versus lower levels of moral character. Our study results support these hypotheses. This work suggests that focusing on game‐like aspects of negotiation can induce a less moral and ethical mindset. To the extent that teaching law students to “think like a lawyer” encourages them to adopt a game frame of negotiation, we can expect such training to reduce the likelihood of honest disclosure.
... A considerable amount of unethical behaviour might, in actuality, lie beyond the realm of conscious reasoning (Gino & Bazerman, 2009;Messick & Bazerman, 2001). The inability of the decision-maker to perceive an ethical dilemma is often called ethical blindness (Palazzo et al., 2012), which is a reason for our bounded ethicality (Bazerman, 2011;Chugh et al., 2005;Kern & Chugh, 2009;Rees et al., 2019). When our thinking is bounded because of the motivational and social pressures that we undergo, we unconsciously exclude certain aspects from our decisionmaking process. ...
Over the past few decades, substantial work has been carried out by researchers in the field of unethical employee behaviour. While self-interest is a more focused area of research, recent studies have investigated pro-organisational unethical behaviour. Furthermore, it is known that unethical behaviour often occurs beyond the realm of conscious awareness. At present, a comprehensive review of unethical employee behaviour that explicates the various types of unethicality is still lacking. In this study, we perform a literature review and integrate the studies under the dimensions of self-interestedness and intentionality. Consequently, four distinct patterns of unethical employee behaviour emerge, which we classify into a typology comprised of four types: (1) unethical pro-self behaviour-explicit, (2) unethical pro-self behaviour-implicit, (3) unethical pro-other behaviour-explicit and (4) unethical pro-other behaviour-implicit. We contend that each of these behaviours consists of different psychological processes, discuss the individual and situational determinants of each typology and tabulate key findings. Overall, we find that the field will significantly benefit from additional impetus being placed on the under-investigated areas of unethical employee behaviours, which, according to our defined typology, includes the implicit and the pro-other types
... Notwithstanding the contribution of positive interdependence among diverse groups to collaborative efforts in the organiza- tional arena, as was demonstrated by the nurses' mixed teams' case and the Jew- ish-Arab inter-organizational environmental partnership, hidden aspects stem- ming from the legacies of prolonged national discord, impinge on the parties relations and pose barriers on engaging 'otherness'. The latter predicament is rooted both in universal individual obstacles such as bias blind spot, errors of third and fourth kind and bounded ethicality and construction of power by social institutions (Bazerman 2011, Desivilya Syna and Rottman 2012, Kristeva 1991, Mitroff and Silvers 2010, Schaap 2006, West et al. 2012). Thus, concerted ac- tions of third parties are necessary in order to confront these largely latent diffi- culties to address 'otherness' in organizations, foreshadowed by deep schisms such as protracted conflicts. ...
The oldest immigrant in Hamburg is said to be 400,000 years old. His name is ‘The old Swede’ and is in fact a 20-meter high boulder weighing 217 tons that sits on the edge of the river Elbe. It is a stone that found its way to Hamburg during the ice age and to many people in Hamburg is emblematic of a port city that has been characterized by the development of global trade relations, both immigration and emigration to and from every region of the world. Hamburg is and always has been a place where very different cultures meet and mix, and where cultural diversity is omnipresent in everyday life.
... Psychologists have confi rmed the existence of many pernicious infl uences on ethical decision-often operating at an unconscious level. When these infl uences lead to unethical behavior that confl ict with an actor's moral beliefs and commitments, the phenomenon may be referred to as bounded ethicality (Bazerman 2011 ;Bazerman and Tenbrunsel 2011 ;Chugh, Bazerman, and Banaji 2005 ;Tenbrunsel 2005 ). 2 One example of bounded ethicality is "ordinary prejudice," which reveals itself in implicit associations about gender, race, and other demographic groups (Bertrand, Chugh, and Mullainathan 2005 ;Green et al. 2007 ;Greenwald et al. 2009 ;Rudman and Ashmore 2007 ). These associations can lead to unintentionally discriminatory results, such as discriminatory hiring practices (Bertrand, Chugh, Bounded Ethicality and OIC 343 and Mullainathan 2005 ) and unwarranted discrepancies in the evaluation of the skills and competencies of workers (Bertrand and Mullainathan 2004 ;Reeves 2014 ), which mimic the results of deliberate discrimination. ...
In this article we investigate a philosophical problem for normative business ethics theory suggested by a phenomenon that contemporary psychologists call “bounded ethicality,” which can be identified with the putative fact that well-intentioned people, constrained by psychological limitations, make ethical choices inconsistent with their own ethical beliefs and commitments. When one combines the idea that bounded ethicality is pervasive with the idea that a person morally ought to do something only if she can, it raises a doubt about the practical relevance of the moral principles that business ethics theory prescribes. We call this doubt the Radical Behavioral Challenge. It consists in the idea that people cannot generally conform to the normative ethical principles that business ethics theorists prescribe, and that these principles are therefore practically irrelevant. We answer the Radical Behavioral Challenge and explore normative implications of our answer.
... There is also evidence of self-serving equity bias in experimental games of climate negotiations (Lange et al. 2010); participants tend to selectively support the equity principles that match their interests. This relates to the concept of "bounded ethicality" (Bazerman 2011) which suggests that individuals view themselves as moral, competent, and deserving, and that they often engage in unethical acts without their own awareness of doing so. Altruism is also context-dependent, individuals behave nicely toward others belonging to the same group but are often hostile toward those outside the group (Sherif 1967;Abbink et al. 2010). ...
Environmental issues provide a rich ground for identifying the existence and consequences of human limitations. In this paper, we present a growing literature lying at the interface between behavioral and environmental economics. This literature identifies alternative solutions to traditional economic instruments in environmental domains that often work imperfectly. But it also faces a set of challenges, including the difficulty of computing welfare effects, and the identification of a robust environmental policy based on context-dependent (socio-) psychological effects. We illustrate our critical discussion with two behavioral schemes that have been widely implemented: “green nudges” and “corporate environmental responsibility.”
The multi-faceted approache to environmental analysis helps us to take deep insights in tracing the behavioural aspect and provides a rich ground for identifying the quiddity and reverberations of human capabilities. This article analyses the extending importance given to the relationship between economics of behaviours and environment. The literature signifies varying solutions to primitive economic mechanism deployed in terms of environmental dimensions that usually happen to be fit unwell. However, it questions the hardships in estimating the general welfare along with designing a comprehensive environmental policy keeping in mind the psycho-economic impact. The study critically examines the behavioural domains of initiatives including green nudges as well as corporate environmental responsibility.
This is a book review article.
Previous theory and research on bounded rationality has emphasized how limited cognitive resources constrain people from making utility maximizing choices. This paper expands the concept of bounded rationality to consider how people’s rationality may be constrained by their internalization of a qualitatively distinct standard for sound judgment, which is commonly labeled reasonableness. In contrast to rationality, the standard of reasonableness provides guidance for making choices in situations that involve balancing incommensurable values and interests or reconciling conflicting points-of-view. We review recent evidence showing that laypeople readily recognize the distinctions between rationality and reasonableness and thus are able to utilize these as distinct standards to inform their everyday decision-making. The fact that people appear to have internalized rationality and reasonableness as distinct standards of sound judgment supports the notion that people’s pursuit of rationality may be bounded by their determination to also be reasonable.
Julia Kristeva’s query with regard to the capacity of individuals in today’s society to confront and deal with social divisions and diversities appears as actual and relevant as ever. Indeed, the 21st century has evinced a marked transition in terms of a growing diversification of the workforce and organizational membership owing to globalization and immigration trends (Coleman Selden and Selden 2001). Understanding the ramifications of social schisms on diversity-related dynamics and performance in organizations has become vital in the current era, characterized by mounting socio-political, cultural and economic complexities, competition and concomitant growing interdependencies among individuals, groups and organizations, hence the need for collaboration.
This article focuses on Jewish–Arab interorganizational partnership in Israel, examining how to effectively engage the differences resulting from the heterogeneity in the context of protracted national conflict. We argue and demonstrate through a case study that developing intergroup partnerships in a context of protracted national conflicts warrants consideration of the differential needs of the minority versus majority group members, namely, fostering power asymmetry sensitivity (PAS). Such sensitivity is important in terms of structural as well as process aspects of the partnership. A model of practice, designed to implement PAS, is presented and critically discussed.
Group members often reason egocentrically, believing that they deserve more than their fair share of group resources. Leading people to consider other members' thoughts and perspectives can reduce these egocentric (self-centered) judgments such that people claim that it is fair for them to take less; however, the consideration of others' thoughts and perspectives actually increases egoistic (selfish) behavior such that people actually take more of available resources. A series of experiments demonstrates this pattern in competitive contexts in which considering others' perspectives activates egoistic theories of their likely behavior, leading people to counter by behaving more egoistically themselves. This reactive egoism is attenuated in cooperative contexts. Discussion focuses on the implications of reactive egoism in social interaction and on strategies for alleviating its potentially deleterious effects.
Individuals working in groups often egocentrically believe they have contributed more of the total work than is logically possible. Actively considering others' contributions effectively reduces these egocentric assessments, but this research suggests that undoing egocentric biases in groups may have some unexpected costs. Four experiments demonstrate that members who contributed much to the group outcome are actually less satisfied and less interested in future collaborations after considering others' contributions compared with those who contributed little. This was especially true in cooperative groups. Egocentric biases in responsibility allocation can create conflict, but this research suggests that undoing these biases can have some unfortunate consequences. Some members who look beyond their own perspective may not like what they see.
This collection explores the subject of conflicts of interest. It investigates how to manage conflicts of interest, how they can affect well-meaning professionals, and how they can limit the effectiveness of corporate boards, undermine professional ethics, and corrupt expert opinion. Legal and policy responses are considered, some of which (e.g. disclosure) are shown to backfire and even fail. The results offer a sobering prognosis for professional ethics and for anyone who relies on professionals who have conflicts of interest. The contributors are leading authorities on the subject in the fields of law, medicine, management, public policy, and psychology. The nuances of the problems posed by conflicts of interest will be highlighted for readers in an effort to demonstrate the many ways that structuring incentives can affect decision making and organizations' financial well-being.
Answer true or false: "I am an ethical manager." If you answered "true," here's an Uncomfortable fact: You're probably wrong. Most of us believe we can objectively size up a job candidate or a venture deal and reach a fair and rational conclusion that's in our, and our organization's, best interests. But more than two decades of psychological research indicates that most of us harbor unconscious biases that are often at odds with our consciously held beliefs. The flawed judgments arising from these biases are ethically problematic and undermine managers' fundamental work--to recruit and retain superior talent, boost individual and team performance, and collaborate effectively with partners. This article explores four related sources of unintentional unethical decision making. If you're surprised that a female colleague has poor people skills, you are displaying implicit bias--judging according to unconscious stereotypes rather than merit. Companies that give bonuses to employees who recommend their friends for open positions are encouraging ingroup bias--favoring people in their own circles. If you think you're better than the average worker in your company (and who doesn't?), you may be displaying the common tendency to overclaim credit. And although many conflicts of interest are overt, many more are subtle. Who knows, for instance, whether the promise of quick and certain payment figures into an attorney's recommendation to settle a winnable case rather than go to trial? How can you counter these biases if they're unconscious? Traditional ethics training is not enough. But by gathering better data, ridding the work environment of stereotypical cues, and broadening your mind-set when you make decisions, you can go a long way toward bringing your unconscious biases to light and submitting them to your conscious will.
The authors review studies conducted by themselves and coauthors that document a 'self-serving' bias in judgments of fairness and demonstrate that the bias is an important cause of impasse in negotiations. They discuss experimental evidence showing that (1) the bias causes impasse; (2) it is possible to reduce impasses by debiasing bargainers; and (3) the bias results from selective evaluation of information. The authors also review results from a field study of negotiations between teachers' unions and school boards in Pennsylvania that both document the fairness bias in a naturalistic setting and demonstrates its impact on strikes. Copyright 1997 by American Economic Association.
This research explores the effects of egocentric interpretations of fairness, expectations about other actors’ harvesting decisions, and communication on the focal actor's harvesting decisions in asymmetric social dilemmas. We found support for the predictions that egocentrism exists in perceptions of fairness in asymmetric dilemmas, overharvesting is positively related to the amount of egocentrism, and egocentrism is stronger before discussion than after discussion. Furthermore, in a comparison between asymmetric and symmetric dilemmas, we found that egocentrism and overharvesting were greater in asymmetric dilemmas than in symmetric dilemmas. Finally, the results indicate that among certain actors, overharvesting in asymmetric dilemmas is positively related to the amount of harvesting expected from the other parties. This study contributes to the social dilemma literature by (1) introducing the idea of egocentric interpretations of fairness as an explanation for overharvesting behavior, (2) demonstrating that egocentrism is more pronounced in asymmetric versus symmetric dilemmas, (3) suggesting that the reduction of egocentric interpretations of fairness is another reason why communication enhances cooperative behavior, and (4) demonstrating that beliefs about what others will do is related to harvesting decisions in asymmetric as well as symmetric dilemmas.