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Article
Publication date: 1 January 2002

John C. Edwards, William McKinley and Gyewan Moon

Building on the enactment perspective and past work on the self‐fulfilling prophecy, this paper explores how organizational decline can be enacted through self‐fulfilling

Abstract

Building on the enactment perspective and past work on the self‐fulfilling prophecy, this paper explores how organizational decline can be enacted through self‐fulfilling prophecies of decline. We present two self‐fulfilling prophecy‐based models of organizational decline, one in which decline is enacted unintentionally through the predictions of an organization's managers, and a second in which decline is enacted unintentionally through the predictions of external constituencies. We articulate propositions that capture the dynamics of each model and that are intended as a platform for future empirical research. We also discuss the implications of our theoretical framework for future theory development on the causes of organizational decline, and offer suggestions for managers who wish to avoid organizational decline.

Details

The International Journal of Organizational Analysis, vol. 10 no. 1
Type: Research Article
ISSN: 1055-3185

Article
Publication date: 17 September 2021

Mostafa Rezaeirad and Alireza Koushki Jahromi

The growth and development of positive psychology approaches in the areas of human resource management has created a successful conceptual basis in the psychology of business and…

Abstract

Purpose

The growth and development of positive psychology approaches in the areas of human resource management has created a successful conceptual basis in the psychology of business and jobs and has led to a tendency to apply knowledge and skills to job expectations in line with job expectations. That profession will grow, and this can also lead to the development of ethical practices. The purpose of this paper is the effect of self-fulfilling prophecy on developing auditors' ethical values.

Design/methodology/approach

The target population of this study was auditors of auditing organizations and private sector audit firms that were selected through random sampling and evaluated over a period of 6 months. The research instrument was standard questionnaires, and partial least squares analysis was used to test and test the research hypotheses.

Findings

The results of this study show that the effect of self-fulfilling prophecy on ethical virtue and ethical conscientiousness as two dimensions of auditors' ethical values has a positive and significant effect.

Originality/value

This study explains how to clearly convey the social expectations of an auditor about value-based approaches in the audit profession, and it examines the role of these expectations in the professional performance of auditors. In fact, beliefs and expectations play a decisive role in improving auditors' level of value based on professional behavior, such as professional skepticism and objectivity, and this research can help increase the level of knowledge about this profession.

Details

International Journal of Ethics and Systems, vol. 38 no. 1
Type: Research Article
ISSN: 2514-9369

Keywords

Book part
Publication date: 12 November 2014

Tiziana Assenza, Te Bao, Cars Hommes and Domenico Massaro

Expectations play a crucial role in finance, macroeconomics, monetary economics, and fiscal policy. In the last decade a rapidly increasing number of laboratory experiments have…

Abstract

Expectations play a crucial role in finance, macroeconomics, monetary economics, and fiscal policy. In the last decade a rapidly increasing number of laboratory experiments have been performed to study individual expectation formation, the interactions of individual forecasting rules, and the aggregate macro behavior they co-create. The aim of this article is to provide a comprehensive literature survey on laboratory experiments on expectations in macroeconomics and finance. In particular, we discuss the extent to which expectations are rational or may be described by simple forecasting heuristics, at the individual as well as the aggregate level.

Details

Experiments in Macroeconomics
Type: Book
ISBN: 978-1-78441-195-4

Keywords

Article
Publication date: 18 May 2015

Giuliana Passamani, Roberto Tamborini and Matteo Tomaselli

The purpose of this paper is to explain why some countries in the eurozone between 2010 and 2012 experienced a dramatic vicious circle between hard austerity plans and rising…

Abstract

Purpose

The purpose of this paper is to explain why some countries in the eurozone between 2010 and 2012 experienced a dramatic vicious circle between hard austerity plans and rising default risk premia. Were such plans too small, and hence non-credible, or too large, and hence non-sustainable? These questions have prompted theoretical and empirical investigations in the line of the so-called “self-fulfilling beliefs”, where beliefs of unsustainability of fiscal adjustments, and hence default on debt, feed higher risk premia which indeed make fiscal adjustments less sustainable.

Design/methodology/approach

Detecting the sustainability factor in the evolution of spreads is uneasy because it is largely non-observable and may be proxied by different variables. In this paper, the authors present the results of a dynamic principal components factor analysis (PCFA) applied to a panel data set of the 11 major EZ countries from 2000 to 2013, consisting of each country’s spread of long-term interest rate over Germany as dependent variable, and an array of leading fiscal and macroeconomic indicators of solvency fiscal effort and its sustainability.

Findings

The authors have been able to identify the role of these indicators that combine themselves as significant latent variables in boosting spreads. Moreover, the large joint deterioration of these variables is identifiably located between 2009 and 2012 and particularly for the group of countries under most severe default risk (with Italy and France as borderline cases). The authors also find evidence that the announcement of the European Central Bank Outright Monetary Transactions program has improved the sustainability assessment of sovereign debts.

Originality/value

Dynamic PCFA is a rather unusual technique with respect to standard econometric tests of models, which is particularly well-suited to reduce the number of variables in a data set by extracting meaningful linear combinations from the observed variables that may concur to explain a given phenomenon (the dependent variable). These combinations, called “common factors”, can be interpreted as latent, non-observable variables.

Details

The Journal of Risk Finance, vol. 16 no. 3
Type: Research Article
ISSN: 1526-5943

Keywords

Book part
Publication date: 3 May 2018

M. Christian Mastilak, Linda Matuszewski, Fabienne Miller and Alexander Woods

Commentators have claimed that business schools encourage unethical behavior by using economic theory as a basis for education. We examine claims that exposure to agency theory…

Abstract

Commentators have claimed that business schools encourage unethical behavior by using economic theory as a basis for education. We examine claims that exposure to agency theory acts as a self-fulfilling prophecy, reducing ethical behavior among business students. We experimentally test whether economics coursework or a manipulated competitive vs. cooperative frame affects measured ethical behavior in simulated decision settings. We measure ethical behavior using established tasks. We also measure ethical recognition to test whether agency theory reduces recognition of ethical issues. Exposure to agency theory in either prior classwork or the experiment increased wealth-increasing unethical behavior. We found no effect on unethical behavior that does not affect wealth. We found no effect of exposure to agency theory on ethical recognition. Usual laboratory experiment limitations apply. Future research can examine why agency theory reduces ethical behavior. Educators ought to consider unintended consequences of the language and assumptions of theories that underlie education. Students may assume descriptions of how people behave as prescriptions for how people ought to behave. This study contributes to the literature on economic education and ethics. We found no prior experimental studies of the effect of economics education on ethical behavior.

Details

Research on Professional Responsibility and Ethics in Accounting
Type: Book
ISBN: 978-1-78754-973-9

Keywords

Book part
Publication date: 27 July 2023

Oswald A. J. Mascarenhas, Munish Thakur and Payal Kumar

Being the most powerful creatures on the planet, we humans should carefully consider our beliefs for the simple reason that the way in which we think influences our behaviors;…

Abstract

Executive Summary

Being the most powerful creatures on the planet, we humans should carefully consider our beliefs for the simple reason that the way in which we think influences our behaviors; this in turn can either transform the world or negatively affect the world. Our mores, paradigms, and worldviews translate into behaviors (e.g., factory farming for meat production and consumption) that in turn modify the environment. In general, much of our thinking system is backed up by some concept, theory, paradigm, or ideology. Our thinking systems generate our belief systems of goals and mission statements; our belief systems, in turn, determine our behavior systems (e.g., our strategies, choices, commissions, omissions as implementation systems); our behavior systems determine our impact systems (e.g., impact on us, our families and neighborhoods, our cities and villages, our state and our country, our globe and sometimes our cosmos). Thus, our behavior systems eventually impact our thinking systems, which we started with, thus completing a circular or spiral loop. This chapter examines the thinking–beliefs–behaviors–impact loop, exploring its internal and external dynamics and validities. Specifically, in Part I, we examine the structure of our belief systems in business; in Part II, we explore the power of our structured belief systems in business; in Part III, we apply critical thinking that systematically questions and seeks to redesign our presumed thinking and belief systems.

Details

A Primer on Critical Thinking and Business Ethics
Type: Book
ISBN: 978-1-83753-308-4

Article
Publication date: 7 June 2022

Kimberly Gleason, Brian Nagle, Yezen H. Kannan and Stephen Rau

This study aims to examine whether two periods of extreme market conditions – the governance crisis and Sarbanes-Oxley Act regulatory shock of 2002 and the 2007–2008 global…

Abstract

Purpose

This study aims to examine whether two periods of extreme market conditions – the governance crisis and Sarbanes-Oxley Act regulatory shock of 2002 and the 2007–2008 global financial crisis – incrementally impacted the self-fulfilling prophecy effect, by examining the propensity of US firms receiving going concern modification (GCM) opinions to go bankrupt relative to their non-GCM distress risk-matched counterparts during these two crisis periods.

Design/methodology/approach

To assess the potential influence of the governance/regulatory shock of 2002 and the global financial crisis moderate or mitigate the self-fulfilling prophecy effect, the authors use multivariate logit analysis, regressing t + 1 bankruptcy status on time t GCM and other bankruptcy determinants, interacting crisis period dummies with the GCM variable.

Findings

GCM firms were more likely to declare bankruptcy than their distressed non-GCM counterparts, confirming prior research documenting the existence of a self-fulfilling prophecy effect. The authors also find that the self-fulfilling prophecy effect was exacerbated by the governance crisis/Sarbanes-Oxley Act regulatory shock, but not the global financial crisis, a financial/banking sector shock.

Originality/value

This study contributes to the financial crisis and auditing literatures by examining whether exogenous shocks exacerbate the self-fulfilling prophecy effect. The present analysis and findings have implications for future academic research related to systemic shocks and for auditors in documenting the inducement effect arising from the issuance of GCMs during crisis periods.

Details

Meditari Accountancy Research, vol. 31 no. 5
Type: Research Article
ISSN: 2049-372X

Keywords

Abstract

Details

The Emerald Review of Industrial and Organizational Psychology
Type: Book
ISBN: 978-1-78743-786-9

Book part
Publication date: 12 January 2021

Roger Friedland and Diane-Laure Arjaliès

This paper explores the role of institutional objects in the constitution of institutional logics. Institutional objects depend for their objectivity on the goods produced through…

Abstract

This paper explores the role of institutional objects in the constitution of institutional logics. Institutional objects depend for their objectivity on the goods produced through those objects, such as economic models, passports, or sacred texts. The authors theorize institutional logics as grammars of valuation that institutionalize goods through institutional objects. The authors identify four value moments through which goods are objectified: institution, the instituting of a good, a belief and an imagination of its objective goodness; production, how the good is produced, what practices are productive of the good; evaluation, how good is the good, the practices and objects through which worth in terms of that good is determined, and territorialization, the domain of reference of the good, to what objects and practices a good can and does refer in its instantiations. The authors assess the adequacy of our model through an institutional object based on the good of “market value” – i.e., an options pricing model. The authors discuss the implications of these findings for institutional logical theory and the sociology of valuation.

Details

On Practice and Institution: New Empirical Directions
Type: Book
ISBN: 978-1-80043-416-5

Keywords

Open Access
Article
Publication date: 19 April 2022

Piero Mella

Stereotypes are simplified and widely shared visions held by a social group regarding a place, object, event or recognizable set of people united by certain characteristics or…

4364

Abstract

Purpose

Stereotypes are simplified and widely shared visions held by a social group regarding a place, object, event or recognizable set of people united by certain characteristics or qualities. They are “dangerous” mental models because they are widely disseminated, devious and capable of acting even unconsciously in individuals, social groups and organizations altering the rationality of assessments and choices and producing discrimination and prejudice. Stereotypes acritically extend from a characteristic of a significant percentage of a category to the totality of individuals. The process of generalization triggered by a stereotype produces the error of discrimination and prejudice. There are numerous forms of stereotypes, but this study takes into account gender stereotypes because they act pervasively, often subtly, to reduce “productivity”. People who are aware of being discriminated perceive an unsatisfactory fulfillment of their motivations, which reduces their incentive to improve their performance. Since productivity measures the efficient use of energy from working in production processes, the author believes that wherever gender stereotypes are at play, there is a productive “waste of energy”, an inefficiency in work activity with harmful effects for organizations of all kinds, including families.

Design/methodology/approach

The work aims to demonstrate that wherever gender stereotypes are at play, a “waste of energy” manifests itself in terms of productivity, representing an inefficiency in work activity with harmful effects for organizations of all kinds, including families. To describe the negative effects stereotypes produce in organizations, some models are presented based on the methods and language of systems thinking. These models, although typically qualitative, are capable of exploring the most accepted theories in the literature: tournament theory, the Pygmalion effect, the Galatea effect, self-fulfilling prophecies, the Queen bee syndrome, the role congruency theory, the glass ceiling theory (“think manager, think male” and “family responsibilities wall”). The paper follows a predominantly organizational and corporate approach, although the copious literature on stereotypes belongs largely to the area of social psychology and organization studies.

Findings

The paper does not consider the psychological origin of stereotypes but highlights their use as routines-shortcuts for evaluations and decisions demonstrating that, when adopted in social systems and within organisations, stereotypes produce different forms of discrimination: in social rights, in work, in careers and in access to levels of education and public services, reducing performance and limit potential. The paper also examines some ways gender and culture stereotypes can be opposed, presenting a change management strategy and some concrete solutions proposed by the process–structure–culture model for social change (PSC model).

Research limitations/implications

The main limitation of the work is that it focuses on gender stereotypes, choosing not to consider the “intersection effect” of these with other stereotypes: racial stereotypes, religious stereotypes, color stereotypes, age stereotypes, sex and sexual orientation stereotypes, and many others, whose joint action can cause serious inefficiencies in organizational work.

Practical implications

As stereotypes are a component of social culture and are handed down, by use and example, from generation to generation, the maintenance over time of stereotypes used by individuals to evaluate, judge and act can be seen as an effect of the typical action of a combinatory system of diffusion, which can operate for a long time if not effectively opposed. Il PSC model indicates the strategy for carrying out this opposition.

Social implications

With regard to gender stereotypes, it should be emphasized that in organizations and social systems, “gender diversity” should be considered an opportunity and not as a discriminating factor and thus encouraged by avoiding harmful discrimination. In fact, this diversity, precisely because of the distinctive characteristics individuals possess regardless of gender, can benefit the organization and lead to an increase in organizational and social performance. The United Nations 2030 Agenda for Sustainable Development (2020) Goal 5: Achieving gender equality and empowering all women and girls is examined in this context.

Originality/value

This study views the action of gender stereotypes as especially harmful “mental models”, highlighting the distortions they cause in the allocation of productive energy in society, groups and organizations. The paper follows a predominantly organizational and corporate approach, although the copious literature on stereotypes belongs largely to the area of social psychology. Using the “logic” and “language” of systems thinking, theories and models that describe and interpret the distorting effects of organizational choices based on stereotypes rather than rational analysis are highlighted. The action of stereotypes and their persistence over time can also be described using combinatory systems theory. With this paper, the author hopes that by acting on the three wheels of change highlighted by the PSC model, through legal provisions, control tools and actions on the culture operated by educational and social aggregative institutions, it should not be impossible to change the prevailing culture so that it becomes aware of the harmful influence of gender stereotypes and other discriminatory mental models and come to reject them. The author hopes this paper will help to understand the need to make this change.

1 – 10 of over 1000