Vertical integration in production and services: development in transaction cost economics

In this paper, we first establish the core, fundamental concepts of Williamson’s TCE, examining the different governance structures or the institutional alternatives that TCE theory proposes. We go on to describe some critical considerations and theoretical proposals that correspond fundamentally to Williamson’s heuristic model, the integration of incentives in organizational forms, idiosyncratic demand, and how the concept of transaction is conceived in general.     

Government Intervention,Perceived Benefit,and Bribery of Firms in Transitional China

This article examines whether (1) government intervention causes bribery (or corruption) as rent-seeking theory suggested; (2) a firm’s perceived benefit partially mediates the relationship between government intervention and its bribing behavior, as rational choice/behavior theory suggested; and (3) other firms’ bribing behavior moderates the relationship between government intervention and a firm’s perceived benefit. Our study shows that government intervention causes bribery/corruption indeed, but it exerts its effect on bribery/corruption through the firm’s perceived benefit. In other words, a firm’s perceived benefit fully mediates the relationship between government intervention and its bribing behavior. We also find that other firms’ bribery positively moderates the relationship between government intervention and a given firm’s bribery. This study partly proves that firms are rational actors. Potential benefit encourages them to practice bribery. Besides, this research also supports the rent-seeking view of bribery/corruption, which argues that government intervention is a source of bribery/corruption. However, we have also identified that only those government interventions that will create “rent” can cause bribery/corruption.     

Stakeholder Salience Revisited: Refining,Redefining, and Refueling an Underdeveloped Conceptual Tool

This article revisits and further develops Mitchell et al.’s (Acad Manag Rev 22(4):853–886, 1997) theory of stakeholder identification and salience. Stakeholder salience holds considerable unrealized potential for understanding how organizations may best manage multiple stakeholder relationships. While the salience framework has been cited numerous times, attempts to develop it further have been relatively limited. We begin by reviewing the key contributions of other researchers. We then identify and seek to resolve three residual weaknesses in Mitchell et al.’s (1997) framework, thereby strengthening its foundations for further development. We argue, first, that urgency is not relevant for identifying stakeholders; second, that it is primarily the moral legitimacy of the stakeholder’s claim that applies to stakeholder salience; and last, that the salience of stakeholders will vary as the degrees of the attributes vary. These insights inform revised definitions of stakeholder salience and legitimacy, and necessitate a new theoretical underpinning for the role of legitimacy. Finally, we present an extensive agenda for future research with the objective of refueling research in stakeholder salience.     

Agency Theory,Reasoning and Culture at Enron: In Search of a Solution

Applying evidence from recently available public information on Enron, I defined Enron’s culture as one rooted in agency theory by asserting that Enron’s members were predominantly agency-reasoning individuals. I then identified conditions present at Enron’s collapse: a strong agency culture with collectively non-compliant norms, a munificent rare-failure environment, and new hires with little business ethics training. Turning to four possible antidotes (selection, objectivist integrity, integrity capacity, and stewardship reasoning) to an agency culture under these conditions, I argued that the currently available ethics literature would have made little difference toward averting Enron’s collapse if any of the recommendations from the relevant ethics literature had been implemented. I conclude by identifying new directions for business ethics literature in order to make it more implementable under the conditions identified at Enron. Essentially, we need a way to clearly determine (1) the difference between connivance and commitment, (2) what is meant by balance with regard to the multiple dimensions of ethics and legal theories, and (3) the proper balance between agency and stewardship reasoning. Brian E. Kulik is a Ph.D. candidate in Management at Washington State University’s School of Business. His work focuses on the prevention of corporate corruption, corporate governance and ethics, teamwork and diversity, and research methods. His research to date has appeared in the Western and National Academy of Management conference proceedings and the journal Organizational Analysis. He earned M.S. degrees from Washington State University and The University of Cincinnati, and M.B.A. from The University of Denver.     

Why People Don’t Take their Concerns about Fair Trade to the Supermarket: The Role of Neutralisation

This article explores how neutralisation can explain people’s lack of commitment to buying Fair Trade (FT) products, even when they identify FT as an ethical concern. It examines the theoretical tenets of neutralisation theory and critically assesses its applicability to the purchase of FT products. Exploratory research provides illustrative examples of neutralisation techniques being used in the FT consumer context. A conceptual framework and research propositions delineate the role of neutralisation in explaining the attitude-behaviour discrepancies evident in relation to consumers’ FT purchase behaviour, providing direction for further research that will generate new knowledge of consumers’ FT purchase behaviour and other aspects of ethical consumer behaviour.     

Salesperson Perceptions of Ethical Behaviors: Their Influence on Job Satisfaction and Turnover Intentions

In the academic world, research has indicated that “good ethics is good business.” Such research seems to indicate that firms, which emphasize ethical values and social responsibilities, tend to be more profitable than others. Generally, the profitability is credited to the firm’s positive relationships with its customers, reduced costs of attempting to rebuild a tarnished image, ease of attracting capital, etc. The research conducted in this study evaluated salespeople’s perceptions of the ethics of businesses in general, their employer’s ethics, their attitudes as consumers, and the relationships existing between these perceptions and the sale force’s job satisfaction and turnover intentions. The results show a positive relationship existing between salesperson perceptions of business ethics, his/her employer’s ethics, consumer attitudes, and the salesperson’s job satisfaction and reduced turnover intentions. Charles E. Pettijohn (D.B.A., Louisiana Tech University) is a professor of marketing in the College of Business Administration at Missouri State University. He is also co-editor of the Marketing Management Journal. His research has appeared in the Journal of Personal Selling and Sales Management, the Journal of Businesss Ethics, Marketing Management Journal, Psychology and Marketing, and the Journal of Marketing Theory and Practice. At Missouri State University, his primary teaching focus is in the areas of Personal Selling and Sales Management. Linda S. Pettijohn (D.B.A., Louisiana Tech University) is a Professor of marketing in the College of Business Administration at Missouri State University. Her research has appeared in the Journal of Personal Selling and Sales Management, Human Resource Development Quarterly, Marketing Management Journal, Psychology and Marketing, and the Journal of Financial Serivices Marketing. At Missouri State University, her primary teaching focus is in the area of Retailing. Albert J. Taylor (D.B.A., Louisiana Tech University) is an associate professor of marketing in the College of Business Administration at Coastal Carolina University. His research has appeared in the Journal of Personal Selling and Sales Management, Human Resource Development Quartely, the International Journal of Hospitality and Tourism Administration, Psychology and Marketing, and the Journal of Applied Business Research. At Missouri State University, his primary teaching focus is in the areas of Marketing Research and Personal Selling.     

Coffee as a Medium for Ethical,Social, and Political Messages: Organizational Legitimacy and Communication

This research examines how an organization, Thanksgiving Coffee, establishes and maintains its legitimacy with its constituent publics. In line with Boyd’s (2000, Journal of Public Relations Research 12(4), 341–353.) concept of actional legitimacy, Thanksgiving Coffee demonstrates a legitimation strategy addressing social issues and by responding to ethical and political questions. Applying Fisher’s (1984, Communication Monographs 51, 1–18) concepts of narrative fidelity and probability, Thanksgiving Coffee’s policies and communication activities were found to alleviate the social issues to which they were addressed and therefore reinforce perceptions of legitimacy among publics. Viewing the influence of organizations from a different perspective, this study provides an example of how the policies of an organization can have a positive impact on the broader society in which it operates. Gregory G. De Blasio teaches courses related to business communication, public relations writing, and marketing communication campaigns. His research interests include the study of communication campaigns as they relate to social issues and organizational legitimacy. Dr. De Blasio joined the Communication Department at Northern Kentucky University in 2004. His Ph.D. in communication is from Wayne State University. He received his M.A. from the Pennsylvania State University and his B.A. from William Paterson University. A past International Association of Business Communicators (IABC) board member and chapter president in Detroit, Greg has provided public relations and marketing communication counsel to clients based in Detroit and elsewhere.     

Religion, Opportunism, and International Market Entry Via Non-Equity Alliances or Joint Ventures

One challenge that globalization has brought to business is that firms, as they expand their market globally through cross-border alliances, need to deal with partner firms from countries of different religious background. The impact of a country’s dominant religion on its firms’ international market entry mode choices has not been examined in traditional approaches. Focusing on hypothesizing the influence of Christian beliefs and atheism (i.e., the absence of belief in any deities), this research aims to fill the gap by exploring religion’s role in providing moral restraint on managers’ propensity for opportunism, which in turn affects these managers’ choices of their firms’ international market entry via non-equity alliances or joint ventures. A study of 22,156 cross-border alliances formed in 48 industries world-wide over 9 years provides new insight toward understanding religion’s influence on firms’ international market entry mode decisions through the ethical dimension of strategic leadership. This article would fit best under the International Management section for reviewing purposes.     

Corporate Social and Financial Performance: An Extended Stakeholder Theory,and Empirical Test with Accounting Measures

Although agreement on the positive sign of the relationship between corporate social and financial performance is observed in the literature, the mechanisms that constitute this relationship are not yet well-known. We address this issue by extending management’s stakeholder theory by adding insights from psychology’s prospect decision theory and sociology’s resource dependence theory. Empirically, we analyze an extensive panel dataset, including information on disaggregated measures of social performance for the S&P 500 in the 1997–2002 period. In so doing, we enrich the extant literature by focusing on stakeholder heterogeneity, perceptional framing, and disaggregated measures of corporate social performance.     

企业组织资本、战略前瞻性与企业绩效:基于中国企业的实证研究

Organizational capital is an institutional arrangement in a firm’s production and management activities, which helps integrate all resources in the firm and affect the firm’s strategic choice and performance. This paper classifies organizational capital into three subtypes, namely power orientated capital, norm orientated capital and knowledge orientated capital. Moreover, strategic proactiveness is also brought into this influencing process. Results show that strategic proactiveness fully mediates the effect of power orientated capital on firm performance, but partially mediates that of norm orientated capital. It is also found that neither power nor norm orientated capital affects innovative performance, whereas knowledge orientated capital affects directly both financial performance and innovative performance. The significance of this research is to provide a meaningful supplement to the theory of decision-making-process for the top management team. Suggestions on how to cultivate organizational capital are provided for Chinese enterprises. __________ Translated and revised from Guanli shijie 管理世界 (Management World), 2007, (5): 83–93     

Organizational Commitment: A Proposal for a Wider Ethical Conceptualization of ‘Normative Commitment’

Conceptualization and measurement of organizational commitment involve different dimensions that include economic, affective, as well as moral aspects labelled in the literature as: ‘continuance’, ‘affective’ and ‘normative’ commitment. This multidimensional framework emerges from the convergence of different research lines. Using Aristotle’s philosophical framework, that explicitly considers the role of the will in human commitment, it is proposed a rational explanation of the existence of mentioned dimensions in organizational commitment. Such a theoretical proposal may offer a more accurate definition of ‘affective commitment’ that distinguishes feelings from rational judgments. The use of a philosophical explanation coherent with psychological findings also allows the discovery of a wider moral concept of ‘normative commitment’. Tomás F. González Cruz is Senior Lecturer in Business Administration at the University of Valencia, Spain. He earned his Bachelor’s degree in Business Administration in Valencia University. Likewise, he has a Doctorate in Business Administration at Valencia University. His principal research interests are: Organizational design and the way in which it is a source of sustainable competitive advantage, ethics, leadership, resource and competence-based theory, total quality management. Manuel Guillén is Senior Lecturer in Management, at the University of Valencia (Spain). Prof. Guillén earned his PhD in Management with a specialization in ethics and strategic management integration. He has been Visiting Scholar at the University of St. Thomas, Minnesota (USA); at the Notre Dame University, Indiana, USA; and guest Visiting Student at IESE Business School doctoral program, in Barcelona. He has presented some of his research at the top conferences in the field (International Strategic Management Society Conference, Annual Conference of the European Business Ethics Network, EBEN) and has published in business ethics and management journals. Since 1997 teaches Business Ethics Seminaries in different Business Schools, institutions and companies.     

The Cosmopolitical Corporation

Moral issues have been included in the studies of consumer misbehavior research, but little is known about the joint moderating effect of moral intensity and moral judgment on the consumer’s use intention of pirated software. This study aims to understand the consumer’s use intention of pirated software in Taiwan based on the theory of planned behavior (TPB) proposed by Ajzen (Organizational Behavior and Human Decision Processes, 50, 179, 1991). In addition, moral intensity and moral judgment are adopted as a joint moderator to examine their combined influence on the proposed research framework. The results obtained from this Taiwan case reveal that the antecedent constructs proposed in the TPB model–an individual’s attitude and subjective norms toward using pirated software, and perceived behavioral control to use pirated software–indeed have positive impacts on the consumer’s use intention of pirated software. In addition, the joint moderating effect of moral intensity and moral judgment is manifested in the consumer’s use intention of pirated software. The results of this study not only could substantiate the results of consumer misbehavior research, but also could provide some managerial suggestions for Taiwanese government authorities concerned and the related software industries devoted to fighting pirated software.     

Marxism,Business Ethics,and Corporate Social Responsibility

Originally delivered at a conference of Marxist philosophers in China, this article examines some links, and some tensions, between business ethics and the traditional concerns of Marxism. After discussing the emergence of business ethics as an academic discipline, it explores and attempts to answer two Marxist objections that might be brought against the enterprise of business ethics. The first is that business ethics is impossible because capitalism itself tends to produce greedy, overreaching, and unethical business behavior. The second is that business ethics is irrelevant because focusing on the moral or immoral conduct of individual firms or businesspeople distracts one’s attention from the systemic vices of capitalism. I argue, to the contrary, that, far from being impossible, business requires and indeed presupposes ethics and that for those who share Marx’s hope for a better society, nothing could be more relevant than engaging the debate over corporate social responsibility. In line with this, the article concludes by sketching some considerations favoring corporations’ adopting a broader view of their social and moral responsibilities, one that encompasses more than the pursuit of profit.     

East Meets West: A Meta-Analytic Investigation of Cultural Variations in Idealism and Relativism

Ethics position theory (EPT) maintains that individuals’ personal moral philosophies influence their judgments, actions, and emotions in ethically intense situations. The theory, when describing these moral viewpoints, stresses two dimensions: idealism (concern for benign outcomes) and relativism (skepticism with regards to inviolate moral principles). Variations in idealism and relativism across countries were examined via a meta-analysis of studies that assessed these two aspects of moral thought using the ethics position questionnaire (EPQ; Forsyth, Journal of Personality and Social Psychology 39, 175–184, 1980). This review identified 139 samples drawn from 29 different countries, for a total sample of 30,230 respondents, and concluded that (a) levels of idealism and relativism vary across regions of the world in predictable ways; (b) an exceptionist ethic is more common in Western countries, subjectivism and situationism in Eastern countries, and absolutism and situationism in Middle Eastern countries; and (c) a nation’s ethics position predicted that country’s location on previously documented cultural dimensions, such as individualism and avoidance of uncertainty (Hofstede, Culture’s Consequences: International Differences in Work-Related Values, 1980). Limitations in these methods and concerns about the validity of these cross-cultural conclusions are noted, as are suggestions for further research using the EPQ.     

Building new roads for entrepreneurship research to travel by: on the work of William B. Gartner

This article takes the awarding of William B. Gartner as a winner of the FSF-Nutek Award (in 2005) as a reason to engage more thoroughly with his production. From the perspective of a European School of Entrepreneurship, we focus in particular on the hermeneutic/phenomenological side of Gartner’s research output and seek to operate as inspired readers of this work as we identify its central tendencies (presence of organization theory and literary inspiration). The aim is thus to situate Gartner’s influence on the entrepreneurship research community based on the lead provided by these tendencies and from there to provide a vision of a future of entrepreneurship research. Bengt Johannisson was a member of the Prize Committee for The International Award for Entrepreneurship and Small Business Research when the prize was awarded to William B. Gartner. The prize is awarded by the Swedish Foundation for Small Business Research (FSF) and the Swedish Board of Industrial and Technical Development (NUTEK). An important aim with this prize is to attract broader attention to this research field. A precondition for choosing the winner of the award is that his/her research is a significant contribution to the theory and empirical understanding of entrepreneurship and the importance of entrepreneurship, new firm formation and small businesses in economic development. Besides the honor, the prize consists of SEK 0.5 million. It has been awarded annually since 1996. More information about the prize and previous winners is available at .     

Work-related Attitudes, Values and Radical Change in Post-Socialist Contexts: A Comparative Study

Marcoux argues that job candidates ought to embellish non-verifiable information on their résumés because it is the best way to coordinate collective action in the résumé ‚game’. I do not dispute his analysis of collective action; I look at the larger picture, which throws light on the role game theory might play in ethics. I conclude that game theory’s conclusions have nothing directly to do with ethics. Game theory suggests the means to certain ends, but the ethics of both the means and ends must be assessed separately before any ethical recommendation can␣be made. Marcoux makes several highly disputable assumptions in order to fit résumés into game theory; his analysis does not take into account the consequences that embellishing has beyond the submission and assessment of␣résumés; his argument depends on his claim that a résumé system in which everyone embellishes is attainable; and finally, his argument relies on an idealization of human␣motivation, rather than abstraction. I conclude that candidates should never embellish their résumés.John Douglas Bishop is a Professor in the Business Administration Program at Trent University in Peterborough, Ontario. His research interests include both business ethics and ethics and capitalism. He is the editor of Ethics and Capitalism, University of Toronto Press, 2000.     

Women, Management and Globalization in the Middle East

This paper provides new theoretical insights into the interconnections and relationships between women, management and globalization in the Middle East (ME). The discussion is positioned within broader globalization debates about women’s social status in ME economies. Based on case study evidence and the UN datasets, the article critiques social, cultural and economic reasons for women’s limited advancement in the public sphere. These include the prevalence of the patriarchal work contract within public and private institutions, as well as cultural and ethical values which create strongly defined gender roles. The discussion examines the complexities of conceptualizing women’s equality and empowerment in Islamic states. The paper reveals that there have been significant achievements in advancing women in leadership and political roles, but that there are still institutional and cultural barriers embedded in business systems. Linking feminist, development and management theoretical strands a development framework is proposed which is sensitive to the Islamic Shar’ia encompassing government, organization and individual level strategies. It is suggested that scholars should integrate literatures from gender and management, development and Middle East studies, and in particular that critical scholars of gender and organization should consider the interrelations of the national and transnational in critiques of contemporary global capitalism to understand the complexity of women and social change in the ME.     

Assessing Freeman’s Stakeholder Theory

At least since the publication of the monumental Strategic Management: A Stakeholder Approach (1984), the “stakeholder theory” originated by R. E. Freeman has engrossed much of the business ethics literature. Subsequently, some advocates have moved a bit too quickly and without proper definition or argument. They have exceeded Freeman’s intentions which are more libertarian and free-market than is often thought. This essay focuses on the versions of stakeholder theory directly authored or coauthored by Freeman in an effort to recover (1) Freeman’s intentions and (2) the argumentative justification of stakeholder theory. It then argues that Freeman’s appeal to legal, economic, and ethical constraints ultimately produce arguments that are invalid. One can thoroughly support legislation constraining corporations or seeking to prevent age discrimination, market monopolies, and externalities and regret the extent that capitalism is heir to such shortcomings without it following that (1) business beneficiaries should be changed from stockholders to stakeholders and (2) the latter should be given serious decision-making power. Further, stakeholder theory neither defines nor battles any obvious opposition. Hence, it is difficult to see what it changes about business management. In short, stakeholder theory either changes too much about business, or nothing important at all (depending on one’s interpretation). Efforts to supplant or improve the reigning theory of capitalism will have to do better.     

Moral Stress: Considering the Nature and Effects of Managerial Moral Uncertainty

To better illuminate aspects of stress that are relevant to the moral domain, we present a definition and theoretical model of “moral stress.” Our definition posits that moral stress is a psychological state born of an individual’s uncertainty about his or her ability to fulfill relevant moral obligations. This definition assumes a self-and-others relational basis for moral stress. Accordingly, our model draws from a theory of the self (identity theory) and a theory of others (stakeholder theory) to suggest that this uncertainty arises as a manager faces competing claims for limited resources from multiple stakeholders and/or across multiple role identities. We further propose that the extent to which the manager is attentive to the moral aspects of the claims (i.e., moral attentiveness) moderates these effects. We identify several consequences of managerial moral stress and discuss theoretical, empirical, and practical implications of our approach. Most importantly, we argue that this work paves an important path for considering stress through the lens of morality.