Download
one more time is the love of money the root of all evil n.
Skip this Video
Loading SlideShow in 5 Seconds..
One More Time: Is the Love of Money the Root of All Evil ? PowerPoint Presentation
Download Presentation
One More Time: Is the Love of Money the Root of All Evil ?

One More Time: Is the Love of Money the Root of All Evil ?

150 Views Download Presentation
Download Presentation

One More Time: Is the Love of Money the Root of All Evil ?

- - - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

  1. One More Time: Is the Love of Money the Root of All Evil ? Shanghai Maritime University October 17-19, 24-26, 2008 Presented by Thomas Li-Ping Tang, Ph.D. Middle Tennessee State University, the USA10/1

  2. One More Time: Is the Love of Money the Root of All Evil ? Shanghai Jiao Tong University October 20, 2008 Presented by Thomas Li-Ping Tang, Ph.D. Middle Tennessee State University, the USA

  3. 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, Vivien Kim Geok Lim, National University of Singapore, Singapore, Roberto Luna-Arocas, University of Valencia, Spain, Eva Malovics, University of Szeged, Hungary,

  4. 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

  5. Recent News in the USA May 31, 2008. Lehman Brothers had assets of $639 billion, but $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.

  6. 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)

  7. Recent News • On September 23, 2008, several days after Wall Street meltdown, FBI started to investigate the officials and these investment banks (e.g., Fannie Mae, Freddie Mac, Lehman Brothers, and AIG).

  8. 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).

  9. 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.

  10. 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 he was in office from 2001 to 2006. Shares were sold to Temasek of Singapore.

  11. 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’ (kickback, 佣金/回扣) must correspond to the strength of ‘naezd’ (racketeering, 敲诈)”.

  12. Russia • Liberal Democratic Party of Russia Leader Vladimir Zhirinovsky: every post in Russia -- with the exception of the five or six highest ones, 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.

  13. 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.

  14. 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.

  15. 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 Democratic Party in Oyo State: Governor Alao-Akala has embezzled (盗用) $24 billion excess crude oil fund released to the State by the Federal Government

  16. 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’ jail for corruption and penalized $1,110 for the cash and the value of the whisky he received.

  17. 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.

  18. Professional Wrestlers as Ushers: Increased Collection Plate Donations by 72%

  19. 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

  20. 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

  21. 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

  22. 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?

  23. 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

  24. 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).

  25. 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)

  26. 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).

  27. 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)

  28. Cognitive: Importance *10 Job Preferences, Pay was ranked: No. 5 by Men No. 7 by Women (Jurgensen, 1978) *11 work goals, Pay was ranked: No. 1 in Germany No. 2 in Belgium, the UK, and the US (Harpaz, 1990)

  29. Cognitive: Importance • How we compare • Outperform Others • “For to him who has shall be given, and he shall have abundance; but from him who does not have, even that which he has shall be taken away” (Matthew, 13: 12).

  30. Cognitive: Power • Power tends to corrupt; and absolute power corrupts absolutely (Lord Acton, Letter to Bishop Mandell Creighton, 1887). • Money talks.

  31. Pay Satisfaction Job satisfaction: A pleasurable or positive emotional state resulting from the appraisal of one’s job or job experiences (Locke, 1976: 300). Pay Satisfaction: Pay Level  Pay Satisfaction relationship is the most robust finding (Heneman & Judge, 2000: 71).

  32. Pay Satisfaction Questionnaire 1. Pay Level 2. Pay Raise 3. Benefit 4. Pay Administration (Heneman & Schwab, 1985) Time 1-Time 2 (Judge & Welbourne, 1994) Majority of studies included only Pay Level Satisfaction of PSQ (Williams, McDaniel, & Nguyen, 2006)

  33. Pay Level Satisfaction • My take home pay • My current salary • My overall level of pay • Size of my current salary

  34. The Love of Money-Pay Satisfaction Adam (1963): Equity model Lawler (1971): Discrepancy model Easterlin (2001): Relative theory Veenhoven (1984): Absolute theory Brickman & Campbell (1971): Adaptation theory Michalos (1985): Aspiration theory

  35. The Love of Money-Pay Satisfaction Poverty consists, not in the decrease of one’s possessions, but in the increase of one’s greed. Plato (427-347 BC) Whoever loves money never has money enough; whoever loves wealth is never satisfied with his income. (Ecclesiastes 5:10) High Income  High Pay Level Satisfaction High Love of Money  Low Pay Level Satisfaction

  36. Pay Satisfaction, So-What? Larger Context: Corporate Ethical Values (social norms) Unethical Behavior Intentions (consequence of pay dissatisfaction) Theory of Planned Behavior

  37. Unethical Behavior Intentions • The incumbent’s self-report and the coworker’s peer-report converged significantly on counterproductive work behavior toward other persons and work stressors (Fox, Spector, Goh, & Bruursema, 2007). • Self-reported behavioral intentions are arguably adequate surrogate measures of actual unethical behavior (Jones & Kavanagh, 1996).

  38. Unethical Behavior Intentions • Schoorman, F. D., & Mayer, R. C. 2008. The value of common perspectives in self-reported appraisals: You get what you ask for. Organizational Research Methods, 11, 148-159.

  39. Unethical Behavior Intentions • Workplace deviance (Greenberg, 2002; Robinson & Bennett, 2000), • Counterproductive behavior (Cohen-Charash & Spector, 2001), • Corruption (Anand, Ashforth, & Joshi, 2004), • Whistle-blowing (Dozier & Miceli, 1985), • Misbehavior (Ivancevich, Konopaske, & Matteson, 2005; Vardi & Weitz, 2004).

  40. Unethical Behavior IntentionsPropensity to Engage in Unethical Behavior (PUB) • We developed a short self-reported measure (PUB) and ask managers: • If you were in that position, what is the probability that you may engage in that activity? • It is a measure of “self-prediction” of their unethical behavior which is highly related to actual behavior

  41. Propensity to Engage in Unethical Behavior: Unethical Behavior Intentions • Factor Resource Abuse • 1. Use office supplies (paper, pen), Xerox machine, and stamps for personal purpose • 2. Make personal long-distance (mobile phone) calls at work • 3. Waste company time surfing on the Internet, playing computer games, and socializing • Factor Not Whistle Blowing • 4. Take no action against shoplifting by customers • 5. Take no action against managers who steal cash/merchandise • Factor Theft • 6. Abuse company expense accounts and falsify accounting records • 7. Take merchandise and/or cash home • 8. Borrow $20 from a register overnight without asking • Factor Corruption • 9. Accept money, gifts, and kickbacks from others • 10. Reveal company secrets when a person offers several million dollars • 11. Sabotage the company to get even due to unfair treatment • 12. Lay off 500 managers to save the company money and increase my personal bonus

  42. Corporate Ethical Values (CEV) • Strong cultures enhance firm performance (O’Reilly & Chatman, 1996) and deter unethical behavior (Baker, Hunt, & Andrews, 2006): Most people do look to the social context to determine what is ethically right and wrong (Bandura, 1977; Thomas, Schermerhorn, & Dienhart, 2004), obey authority figures (Litzky, Eddleston, & Kidder, 2006; Milgram, 1974), do what is rewarded (Skinner, 1972; Treviño & Brown, 2004), and follow the code of ethics (Bethoux, Didry, & Mias, 2007).

  43. Cross-Cultural Study 64%: only 2 countries 23%: > 2 countries (Sin, Cheung, & Lee, 1999). 72.43%: did not report Measurement Invariance (He, Merz, & Alden, 2008) Configural Invariance: Factor structure Metric Invariance: Factor Loading

  44. The Income Pyramid Prahalad & Hammond, 2002, HBR $ N --------------------------------------------------------- 1. > $20,000 100 Million 2. $2,000 – $20,000 2,000 Million 3. < $2,000 4,000 Million

  45. Level of Economic Development 1. GDP > 20,000 2. GDP 5,000 – 20,000 3. GDP < 5,000 We treat GDP as a “Moderator”