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One More Time: Is the Love of Money the Root of All Evil ? Shanghai Maritime University October 17-19, 24-26, 2008 March 12-14,19-21, 2010 Presented by Thomas Li-Ping Tang, Ph.D. Middle Tennessee State University, the USA10/8
One More Time: Is the Love of Money the Root of All Evil ? Shanghai Jiao Tong University October 20, 2008 March 15-17, 2010 Presented by Thomas Li-Ping Tang, Ph.D. Middle Tennessee State University, the USA
Toto Sutarso, Middle Tennessee State University, U.S.A., Adebowale Akande, International Institute of Research,South Africa, Michael W. Allen, University of Sydney, Australia, Abdulgawi Salim Alzubaidi, Sultan Qaboos University, Oman, Mahfooz A. Ansari, University of Lethbridge,Canada, Fernando Arias-Galicia, Universidad Autónoma del Estado de Morelos, Mexico, Mark G. Borg, University of Malta, Malta, Luigina Canova, University of Padua, Italy, Brigitte Charles-Pauvers, University of Nantes, France, Bor-Shiuan Cheng, National Taiwan University,Taiwan, Randy K. Chiu, Hong Kong Baptist University, Hong Kong, Linzhi Du, Nankai University, China, Ilya Garber, Saratov State Socio-Economic University,Russia, Consuelo Garcia De La Torre, Technological Institute of Monterrey, Mexico, Rosario Correia Higgs, Polytechnic Institute of Lisbon – Portugal, Portugal, Abdul Hamid Safwat Ibrahim, Iman University, Saudi Arabia, Chin-Kang Jen, National Sun-Yat-Sen University,Taiwan, Ali Mahdi Kazem, Sultan Qaboos University, Oman, Kilsun Kim, Sogang University, South Korea, Jian Liang, Shanghai Jiao Tong University, Vivien Kim Geok Lim, National University of Singapore, Singapore, Roberto Luna-Arocas, University of Valencia, Spain, Eva Malovics, University of Szeged, Hungary,
Anna Maria Manganelli, University of Padua, Italy, Alice S. Moreira, Federal University of Pará, Brazil, Richard T. Mpoyi, Middle Tennessee State University, the U.S.A., Anthony Ugochukwu Obiajulu Nnedum, Nnamdi Azikiwe University,Nigeria, Johnsto E. Osagie, Florida A & M University, U.S.A., AAhad M. Osman-Gani, Nanyang Technological University, Singapore, Francisco Costa Pereira, Polytechnic Institute of Lisbon – Portugal, Portugal, Ruja Pholsward, RangsitUniversity, Thailand, Horia D. Pitariu, Babes-Bolyai University, Romania, Marko Polic, University of Ljubljana, Slovenia, Elisaveta Sardzoska, University St. Cyril and Methodius,Macedonia, Petar Skobic, Middle Tennessee State University, U.S.A. Allen F. Stembridge, Andrews University, U.S.A., Theresa Li-Na Tang, AffinionGroup, Brentwood, TN, U.S.A., Thompson Sian Hin Teo, National University of Singapore,Singapore, Marco Tombolani, University of Padua,Italy, Martina Trontelj, University of Ljubljana, Slovenia, Caroline Urbain, University of Nantes, France Peter Vlerick, Ghent University, Belgium
Research: Summary • Journal article: 127 • Conference Paper: 205 • Language (published): 5* • Language (cited): 8** • *Chinese, English, Italian, Romanian, Spanish • ** Chinese, English, French, Italian, Romanian, Spanish, Turkish, Russian
Journal Impact Factor • Journal of Applied Psychology (3.769) • Intelligence (3.757) • Journal of Management (2.558) • Journal of Organizational Behavior (2.441) • Personnel Psychology (2.222) • Computers & Education (2.190) • Personality and Individual Differences (1.982) • Human Relations (1.372) • Journal of Business Ethics* (1.023)
ISI Web of KnowledgeCitation (2/12/2010) • Article (127): 66 • Citation: 611 • Average citations/year: 22.63 • Average citations/item: 9.26 • h-index: 14* *14 papers with 14 citations or more
Research Interest • Management, HRM, OB • Motivation, QC, Compensation • Individual Differences Work Ethic, Leisure Ethic, Self-Esteem, Money Ethic, The Love of Money, Behavioral Ethics
Collaborators in 37countries • Australia, Belgium, Brazil, Bulgaria, China, Congo, Croatia, Egypt, France, Hong Kong, Hungary, Italy, Japan, Kyrgyzstan, Macedonia, Malaysia, Malta, Mexico, Nigeria, Oman, Peru, the Philippines, Poland, Portugal, Romania, Russia, Saudi Arabia, Singapore, Slovenia, South Africa, South Korea, Spain, Taiwan, Thailand, Turkey, UK, the USA.
Service • Editorial Board: 7 • Reviewer (Journal): 33 • Reviewer (Conference): 10
Award • Outstanding Research (PSY) 1991 • Outstanding Research (MGT) 1999 • International Service 1999 • Outstanding Faculty 2008 • Career Achievement Award 2008 • The Best Reviewer Award IM (AoM) 2003, 2007, 2009
MTSU • Visit http://www.mtsu.edu/ • Faculty and Staff (Photo) 2/12/2010 • Virtual Tour (Video)
Recent News in the USA May 31, 2008. Lehman Brothers had assets of $639 billion, but was $613 billion in debt. 639 - 613 = 26; 26/639 = 4% CEO Dick Fuld’s one-year total pay was $71.9 million, five-year total pay was $354 million. He received a $39 million (€24.7 million) bonus in cash and restricted stock in 2007.
Recent News • On Monday, September 15, 2008, Lehman Brothers, a 158-year-old investment bank, filed for Chapter 11 protection in the US. • It was the biggest corporate bankruptcy in history with $639 billion, followed by WorldCom with $126 billion and Enron with $81 billion. (former Chief Financial Officer Andrew Fastow and former Chief Executive Officer Jeffrey Skilling)
Recent News • On September 23, 2008, several days after Wall Street meltdown, FBI started to investigate officials at these investment banks (e.g., Fannie Mae, Freddie Mac, Lehman Brothers, and AIG).
Recent News • Lloyd Blankfein, CEO of Goldman Sachs, took home $74 million in salary, bonuses and other awards in 2007. • James E. Cayne, former CEO of Bear Stearns made $49.31 million over the last two years (2006-2007).
Recent News • Martin J Sullivan, former CEO of American International Group (AIG), raked in $39.6 million in the last three years (2005-2007). Sullivan oversaw two quarters of record losses as the insurance giant's head. Shareholders pressured him to quit in June. Severance package plus bonus: $19 million.
Illinois Governor Charged with Corruption 12/9/2008 • Gov. Rod Blagojevich and his chief of staff, John Harris, were arrested Tuesday for what U.S. Atty. Patrick Fitzgerald called a "political corruption crime spree" that included attempts to sell the U.S. Senate seat to the Highest Bidder, vacated by President-elect Barack Obama.
Kenneth Lay - Enron • Quintessential fraudulent executive. • Indicted on July 7, 2004 for Enron catastrophe. • Prior to indictment, estimated net worth $40M. • During trial, Lay claimed net worth was ($250k). • 20,000 employees lost jobs.
Enron’s Market Share Price http://ca.encarta.msn.com/media_701610605/the_fall_of_enron_stock.html
Robert Nardelli – Home Depot • Amassed approx. $500M in six-year tenure. • January 3, 2007 received $210M severance “golden parachute” (part of $500M). • Meanwhile, investors saw minimal improvement in share price. • Now CEO of Chrysler LLC.
Thailand: Bangkok Post • Prosecutors in Thailand seek the confiscation of 76 billion baht in cash and assets from the former Prime Minister Thaksin Shinawatra and his family. • The former Prime Minister was accused of abusing his power by changing tax and telecommunications policies to benefit his own business empire, Shin Corp., while in office from 2001 to 2006. Shares were sold to Temasek of Singapore.
Russia • Corruption in Russia is the rule rather than the exception. • Nikolai Zlobin, a former political adviser to the Kremlin living in Washington, DC: The formula of modern power in Russia is: “The size of ‘otkat’ (kickbacks, 佣金/回扣) must correspond to the strength of ‘naezd’ (racketeering, 敲诈)”.
Russia • Leader of the Liberal Democratic Party of Russia, Vladimir Zhirinovsky: every post in Russia—with the exception of the five or six highest—is available for sale. • A governorship costs about €5 to €7 million. • A department head or the head of a federal agency, costs €3 to €4 million.
China • Two former Bank of China managers and their wives were convicted in Las Vegasfor money laundering/洗钱and racketeering/敲诈in the US involving at least $485 million over 13 years. • A Chinese national was repatriated (被遣返回国)from Canada for prosecution.
Singapore • Ng Teck Lee failed in his duties as CEO of a waste recycling company, Citiraya, and committed fraud against the firm. • Investigators believe that Ng skipped town with S$72 million ($51 million), making it one of Singapore’s biggest ever corporate scandals and frauds.
Nigeria • 10% of the daily supply of oil in Nigeria is stolen from pipelines and other facilities by criminals and militants and sold off illegally (blood diamond/oil) • Leaders of People’s Democratic Party in Oyo State: Governor Alao-Akala has embezzled (盗用) $24 billion from the excess crude oil fund released to the State by the Federal Government
Corruption • After a thief was nabbed by the police and the stolen goods retrieved, a Staff Sergeant contacted the businessman indicating that his $7,000 worth of stolen jewelry had been pawned and was about to be melted. • The police officer asked for $2,000. The businessman could offer only $1,000 and two bottles of whisky. • Judge: The police officer had violated the public’s trust, abused his position, and asked for extra incentives to do essentially his job. The officer was sentenced to 14 months in jail for corruption and penalized $1,110 for the cash and the value of the whisky he received.
Corruption • is both a state and a process. • It reflects not only the corrupt behavior of an individual—defined as the illicit use of one’s position or power for perceived personal or collective gain—but also the dangerous, viruslike infection of a group, organization, industry, or country or geopolitical entity (Ashforth, Gioia, Robinson, & Treviño, 2008).
Money • People around the world have different economic, legal, political, and social infrastructures, history, cultures, beliefs, values, attitudes, and behavior; yet they all speak one language that everyone understands: Money.
Professional Wrestlers as Ushers: Increased Collection Plate Donations by 72%
What is the difference? • $1 • $100
Money • The instrument of commerce and the measure of value(Smith, 1776/1937). • Attract, retain, and motivate employees and achieve organizational goals(Chiu, Luk, & Tang, 2002; Milkovich & Newman, 2005; Tang, Kim, & Tang, 2000). • Objective
The Meaning of Money is “in the eye of the beholder”(McClelland, 1967, p. 10) and can be used as the “frame of reference”(Tang, 1992)in which people examine their everyday lives(Tang & Chiu, 2003; Tang, Luna-Arocas, & Sutarso, 2005). Subjective
The Meaning of Money • Children from poor economic backgrounds overestimate the size of a coin than their affluent counterparts (Bruner & Goodman, 1947). • College students’ money anxiety is influenced by both paternal and maternal money anxiety (Lim & Sng, 2006).
Voh, Meed, & Goode (2006) 1. Descrambling task: 5 words: A high paying salary, See Monopoly Money, vs. Neutral 2. Read aloud: An Abundance of Money vs. Meager resources 3. Screensaver: Currency floating underwater vs. fish swimming underwater, no screen 4. Monopoly Money: $4000, $200, $0; Imagine Abundance of Money, Strained Finances 5. Poster: Money, Leisure, Flower
Money--Self-Sufficiency • Worked longer before asking help • Volunteered less (5.10/8.47 sheets) • Volunteered less (67.35/147.81 sec.) • Gathered less pencils (18/20, 27 pencils) • Donated less money (.77/1.34, $2.00) • Played alone--individually focused leisure • Kept a larger distance: two chairs
Thinking that time is money leads people to volunteer less (DeVoe & Pfeffer, 2007). • Counting 80 $100 bills (compared to counting 80 pieces of paper) reduces people’s physical pain (Zhou, Vohs, & Baumeister, 2009). • Anticipation of pain heightens the desire for money (Zhou & Gao, 2008).
Presence of Money • The presence of abundant wealth (with visible $7,000 in real $1 bills on a table) provokes feeling of “envy toward wealthy others” that, in turn, causes a significantly higher percentage of participants to engage in and a much larger magnitude of cheating for personal gains than without such abundance of money (Gino & Pierce, 2009: 142).
Money as tool and as drug • Money (as tool) is instrumental in satisfying biological and psychological needs. • Metaphorically, money is a functionless, powerful, addictive, and insatiable drug (motivator)(Lea & Webley, 2006) • Drug addicts require larger dosages to maintain the same level of “high” (Mason, 1992), most people want more money in order to achieve the same original level of utility.
The Importance of Money *10 Job Preferences, Pay was ranked: (Jurgensen, 1978) No. 5 by Men No. 7 by Women *11 work goals, Pay was ranked: (Harpaz, 1990). No. 1 in Germany No. 2 in Belgium, UK, and the US
The ABCs of Money Attitudes Affective: Do you “love or hate” money? Behavioral: What do you “do” with your money? Cognitive: What does money “mean” to you?
The Love of Money Scale Factor 1: Rich (Affective) 1. I want to be rich. 2. It would be nice to be rich. 3. Having a lot of money (being rich) is good. Factor 2: Motivator (Behavior) 4. I am motivated to work hard for money. 5. Money reinforces me to work harder. 6. I am highly motivated by money. Factor 3: Importance (Cognitive) 7. Money is good. 8. Money is important. 9. Money is valuable. Factor 4: Power (Cognitive) 10. Money is power. 11. Money gives one considerable power. 12. Money can buy the best products and services
Affective: Rich • Love or Hate • Most people love Money. • I want to be Rich. • Whoever loves money never has money enough; whoever loves wealth is never satisfied with his income (Ecclesiastes 5: 10).
The Love of Money • Those who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge people into ruin and destruction. For the love of money is a root of all kinds of evil. (1 Timothy 6: 9-10)
Behavioral: Motivator • Strategy Performance Improvement • Pay: 30% • Goal Setting: 16% • Job Design: 9% • Participation: 0% (Locke, E. A., Feren, D. B., McCaleb, V. M., Shaw, K. N., & Denny, A. T. 1980).
Behavioral: Money is a Motivator • Herzberg: Money Movement (no motivation) • A clear link: Performance Rewards (Nohria, Groysberg, & Lee, HBR, 2008) • When people were paid for finding insect parts in a food processing plant, innovative employees brought insect parts from home to add to the food just before they removed them and collected the bonus (Milkovich & Newman, 2008)