IDEAS home Printed from https://ideas.repec.org/p/upf/upfgen/584.html
   My bibliography  Save this paper

Economic rationality and ethical behavior

Author

Abstract

This paper argues that economic rationality and ethical behavior cannot be reduced one to the other, casting doubts on the validity of formulas like 'profit is ethical' or 'ethics pays'. In order to express ethical dilemmas as opposing economic interest with ethical concerns, we propose a model of rational behavior that combines these two irreducible dimensions in an open but not arbitrary manner. Behaviors that are neither ethical nor profitable are considered irrational (non-arbitrariness). However, behaviors that are profitable but unethical, and behaviors that are ethical but not profitable, are all treated as rational (openness). Combining ethical concerns with economic interest, ethical business is in turn an optimal form of rationality between venality and sacrifice. Because every one prefers to communicate that he acts ethically, ethical business remains ambiguous until some economic interest is actually sacrificed. We argue however that ethical business has an interest in demonstrating its consistency between communication and behavior by a transparent attitude. On the other hand, venal behaviors must remain confidential to hide the corresponding lack of consistency. This discursive approach based on transparency and confidentiality helps to further distinguish between ethical and unethical business behaviors.

Suggested Citation

  • Marc Le Menestrel, 2001. "Economic rationality and ethical behavior," Economics Working Papers 584, Department of Economics and Business, Universitat Pompeu Fabra.
    • Handle: RePEc:upf:upfgen:584
    as

    Download full text from publisher

    File URL: https://econ-papers.upf.edu/papers/584.pdf
    File Function: Whole Paper
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Velasquez, Manuel, 1992. "International Business, Morality, and the Common Good," Business Ethics Quarterly, Cambridge University Press, vol. 2(1), pages 27-40, January.
    2. Committee of Experts on Tobacco Industry Documents, World Health Organization, 2000. "Tobacco Company Strategies to Undermine Tobacco Control Activities at the World Health Organization," University of California at San Francisco, Center for Tobacco Control Research and Education qt83m9c2wt, Center for Tobacco Control Research and Education, UC San Francisco.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alexandros-Andreas Kyrtsis, 2011. "Insurance of Techno-Organizational Ventures and Procedural Ethics: Lessons from the Deepwater Horizon Explosion," Journal of Business Ethics, Springer, vol. 103(1), pages 45-61, April.
    2. Rode, Julian & Le Menestrel, Marc & Cornelissen, Gert, 2015. "Can monetary valuation undermine nature conservation? Evidence from a decision experiment," UFZ Discussion Papers 9/2015, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).
    3. Marc Le Menestrel & Mark Hunter & Henri Claude de Bettignies, 2001. "Internet e-ethics in confrontation with an activists' agenda: Yahoo! on trial," Economics Working Papers 577, Department of Economics and Business, Universitat Pompeu Fabra.
    4. Marc Le Menestrel & Sybille van den Hove & Henri Claude de Bettignies, 2001. "Processes and consequences in business ethical dilemmas: The oil industry and climate changes," Economics Working Papers 591, Department of Economics and Business, Universitat Pompeu Fabra.

    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. Abdul Karim Aldohni, 2018. "Is Ethical Finance the Answer to the Ills of the UK Financial Market? A Post-Crisis Analysis," Journal of Business Ethics, Springer, vol. 151(1), pages 265-278, August.
    2. Haruko Noguchi, 2015. "How does the Price Regulation Policy Impact on Patient–Nurse Ratios and the Length of Hospital Stays in Japanese Hospitals?," Asian Economic Policy Review, Japan Center for Economic Research, vol. 10(2), pages 301-323, July.
    3. Mulu Abraha Woldegiorgis & Janet E. Hiller & Wubegzier Mekonnen & Jahar Bhowmik, 2018. "Disparities in maternal health services in sub-Saharan Africa," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 63(4), pages 525-535, May.
    4. Maimoona Aboobakur & Ali Latheef & Ahmed Mohamed & Sheena Moosa & Ravindra Pandey & Anand Krishnan & Dorairaj Prabhakaran, 2010. "Surveillance for non-communicable disease risk factors in Maldives: results from the first STEPS survey in Male," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 55(5), pages 489-496, October.
    5. Xiao Tan, 2017. "Explaining provincial government health expenditures in China: evidence from panel data 2007–2013," China Finance and Economic Review, Springer, vol. 5(1), pages 1-21, December.
    6. Nathaniel Wander & Ruth Malone, 2007. "Keeping Public Institutions Invested in Tobacco," Journal of Business Ethics, Springer, vol. 73(2), pages 161-176, June.
    7. Michele Bloch & Cathy L. Backinger & Wilson M. Compton & Kevin Conway, 2012. "Standing on the Threshold of Change," Risk Analysis, John Wiley & Sons, vol. 32(s1), pages 1-5, August.
    8. Anne Taylor & Stefano Campostrini & Tiffany Gill & Patricia Carter & Eleonora Dal Grande & Michele Herriot, 2010. "The use of chronic disease risk factor surveillance systems for evidence-based decision-making: physical activity and nutrition as examples," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 55(4), pages 243-249, August.
    9. Marc Le Menestrel & Sybille van den Hove & Henri Claude de Bettignies, 2001. "Processes and consequences in business ethical dilemmas: The oil industry and climate changes," Economics Working Papers 591, Department of Economics and Business, Universitat Pompeu Fabra.
    10. Patricia Gabaldon & Stefan Gröschl, 2015. "A Few Good Companies: Rethinking Firms’ Responsibilities Toward Common Pool Resources," Journal of Business Ethics, Springer, vol. 132(3), pages 579-588, December.
    11. Lee, Chung-Yol MD, MPH & Glantz, Stanton A. Ph.D., 2001. "The Tobacco Industry's Successful Efforts to Control Tobacco Policy Making in Switzerland," University of California at San Francisco, Center for Tobacco Control Research and Education qt09t535s7, Center for Tobacco Control Research and Education, UC San Francisco.
    12. Kim Raine, 2012. "Obesity epidemics: inevitable outcome of globalization or preventable public health challenge?," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 57(1), pages 35-36, February.
    13. Kim Raine & Ronald Plotnikoff & Candace Nykiforuk & Heather Deegan & Eric Hemphill & Kate Storey & Donald Schopflocher & Paul Veugelers & T. Wild & Arto Ohinmaa, 2010. "Reflections on community-based population health intervention and evaluation for obesity and chronic disease prevention: the Healthy Alberta Communities project," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 55(6), pages 679-686, December.
    14. Radwan Al Ali & Samer Rastam & Fouad Fouad & Fawaz Mzayek & Wasim Maziak, 2011. "Modifiable cardiovascular risk factors among adults in Aleppo, Syria," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 56(6), pages 653-662, December.
    15. Louise Persson & Katarina Haraldsson & Curt Hagquist, 2016. "School satisfaction and social relations: Swedish schoolchildren’s improvement suggestions," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 61(1), pages 83-90, January.
    16. Daniel Reidpath & Mohd Masood & Pascale Allotey, 2014. "How much energy is locked in the USA? Alternative metrics for characterising the magnitude of overweight and obesity derived from BRFSS 2010 data," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 59(3), pages 503-507, June.
    17. Teresa Cardoso & Mónica Oliveira & Ana Barbosa-Póvoa & Stefan Nickel, 2012. "Modeling the demand for long-term care services under uncertain information," Health Care Management Science, Springer, vol. 15(4), pages 385-412, December.
    18. Martin Schlag & Domènec Melé, 2020. "Building Institutions for the Common Good. The Practice and Purpose of Business in an Inclusive Economy," Humanistic Management Journal, Springer, vol. 5(1), pages 1-6, July.
    19. Woojin Chung & Hanjoong Kim & Seungji Lim & Sunmi Lee & Kyungsook Cho, 2009. "Factors influencing cigarette smoking and quantified implications for anti-smoking policy: evidence from South Korea," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 54(6), pages 409-419, December.
    20. Catherine Chittleborough & Helen Winefield & Tiffany Gill & Carmen Koster & Anne Taylor, 2011. "Age differences in associations between psychological distress and chronic conditions," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 56(1), pages 71-80, February.

    More about this item

    Keywords

    Rationality; business ethics; economic rationality; transparency; confidentiality;
    All these keywords.

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

    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:upf:upfgen:584. 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: http://www.econ.upf.edu/ .

    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.