A Misconstrued Perception of Who the "Bad Guys" Are

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Behavioral ethics, a growing area within psychology and management literature, demonstrates that an individual’s unethical behavior is demonstrated through self-deception.

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Open any newspaper or Internet site, turn on the radio or TV, and a large portion of the news you’ll see will be dedicated to people’s wrongdoings. We hear about crimes and wars, disputes and corruption, and racism and discrimination on a daily basis. Police forces and civil service authorities put great efforts into making sure that “bad people” obey legal and ethical norms. Much of the tiresome bureaucracy that strains the relationship between citizens and federal institutions derives from the assumption, authorities hold that “bad people” will always try to evade the rules, and they therefore implement rigid and unproductive systems. A common perception is that these horrible transgressions are the fault of “bad people” and if the state only knew in advance who they are and what their plans are, nothing bad would happen.

In my new book, The Law of Good People (CUP 2018) which came out earlier this month, I argue that as a society, we have a misconstrued perception of who the “bad guys” are, and that in reality, we – all of us – are violators of laws, regulations, contracts and ethical norms. Many studies on the causes of “ordinary unethicality” – including insurance fraud, employee theft and tax evasion – suggest how prevalent and sometimes banal wrongdoing can be. Acts of ordinary unethicality are part of most private law disputes in areas such as breach of contract, tortious interference and lack of respect for people’s property rights. In addition, much of the misconduct within the sphere of tax law, administrative law and corporate law involves this very kind of moral transgression.

Behavioral ethics, a growing area within psychology and management literature, demonstrates that an individual’s unethical behavior is demonstrated through numerous processes such as self-deception, ethical fading, motivated reasoning, ethical dissonance and moral disengagement. Since many of these mechanisms are only partially related to people’s deliberative reasoning, they still consider themselves good people, particularly when engaging in “ordinary unethicality.”

If we were to change our bureaucratic institutions to focus on the “good people,” regulators would be able to determine in advance which types of situations are likely to encourage acts of ordinary unethicality; which policy tools are more or less effective when dealing with people who don’t view their actions as unethical or illegal; and could create a more effective regulatory system suitable for those who can’t seem to follow the rules.

In the context of corruption, behavioral ethics show that mayors, or even prime ministers, can be self-deceiving as to their impartiality in making decisions, thus minimizing the weight of their personal connections and preferences to the decision at hand. For example, research shows that doctors are more likely to prescribe drugs manufactured by drug companies who have invited them to their conferences. While these doctors believe that the main criteria affecting their prescription decisions are related to the best interests of their patients, they undermine the documented effects of their ties to the company. More practically, understanding which situations are prone to corruption (e.g. subtle conflict of interest, non-monetary influence – such as friendship or prestige – and vague legal requirements) would help regulators focus their energy proportionally. While many more public officials would favor someone who wrote a supportive op-ed over someone who made them a political donation, the law takes the latter far more seriously.

Although behavioral ethics research suggests that “harm reduction” – minimizing the harm associated with a potential problem rather than eradicating it – only makes said problem worse, policy makers tend to choose this strategy over eradication, ignoring the fact that it provides “good people” with a higher level of justification for their behavior. Thus for example, asking people to disclose their conflict of interest, was shown experimentally to cause some people to behave less ethically. This partial solution has given them the “moral license” that good people need to be able to promote their self-interest while feeling that they are ethical individuals.

My book suggests different ways in which policy makers can make better use of regulatory tools, such as incentives and reminders, in order to increase civil compliance with laws and regulations.

The article was first published in the Jerusalem Post