business ethics

Ethics

systematic set of morality

descriptive ethics

what people and cultures actually believe about right or wrong

normative ethics

what people ought to do and the priniciples that justify those claims

transcendence

higher goals outside oneself

self-actualization

desire to reach and accomplish full potential, learning, creativity, and growth

aesthetic

search for beauty, balance, and form

cognitive

knowledge, meaning

esteem

confidence, achievements, individuality, respect, cognition

love and belonging

sense of connection, family, friendships, intimacy, affection

safety

personal and financial security, stability, freedom from fear, health, well-being, employment, property, family, social stability

physiological

metabolic requirements for survival (air, food, water, sleep, homeostasis); protection from the elements (shelt

altruism

selfless concern for one’s well-being without care for one’s own interest

ethical decision making process

1. Determine the facts
2. Identify the ethical issues
3. Identify stakeholders and their viewpoints
4. Consider the available alternatives (moral imagination)
5. Compare and weigh alternatives
-ROCC: Rules, Outcomes, Character, Community
6. Make a decision and plan implementation
7. Monitor outcomes and learn

prospect theory

explains how people make decisions under risk and uncertainty

• evaluate potential gains and losses relative to a reference point (status quo)

• losses loom larger than gains (loss aversion)

  • explain why people migh reject fair gambles, cling to failing investments, or buy insurance for unlikely events

endowment effect

tendency for people to assignment more value to things merely because they own them

expectation bias

occurs when a person’s prior belief or expectations influence how they interpret or evaluate information

• stereotypes/assumptions

  • perpetuate inequality and undermine objectivity

confirmation bias

tendency to seek out, interpret, and remember information that confirms our preexisting beliefs while ignoring or discounting evience that contradicts them

• reinforces existing views and can lead to flawed decision-making

  • distort objectivity and hinder learning

self-serving bias

tendency to attribute successes to internal factors (skill or effort) and failures to external factors (bad luck or unfair conditions)

• distort accountability and learning

context dependence

how the enviornment or surrounding information influences perception, judgement, and decision-making

• interpret stimuli differently depending on the context in which they appear

halo effect

our overall impression of a person or entity influences how we evaluate their specific traits

hindsight bias

tendency to see events as having been predictable after they have occured

• distort memory and learning, difficult to evaluate decisions fairly

availability heuristic

mental shortcut where people estiamte the likelihood of events based on how esaily examples come to mind

• skewed risk assessments and policy decisions

representative heuristic/fallacy

judging the probability of an event based on how much it resembles a typical case, rather than considering actual statistical likelihood 

• stereotyping and flawed predictions

anchoring heuristic

individuals rely too heavily on an intial piece of information when making decisions

• affects negotiations, pricing, and assessmentsb

base rate fallacy

occurs when peole ignore general statisitical information in favor of specfiic anecdotal or case-based details

• leads to flawed judgements about probability and risk

conjunction fallacy

people assume that specific conditions are more probable than a single general one

• violates basic probability rules, where the prbability of two events occuring together is always less than or equal to the probability of either occuring alone

gambler’s fallacy

mistaken belieg that past random events influence future ones

• For example, after flipping several heads in a row, someone might believe tails is "due," even though each
  flip is independent.

  • This fallacy reflects a misunderstanding of randomness and probability.

casual fallacies

errors in reasoning about case and effect. occur when people assume casuation withtout sufficient evidence, confuse correlation with causation, or overlook alternative explanations

Post Hoc

fallacy of assuming that because one event followed another, the first caused the second

• classic error in casual reasoning

regression to the mean

statistical tendency for extreme outcomes to move closer to the average over time

bad reasons fallacy

occurs when someone concludes that a claim is false simply becauuse the arguments offered in its support are flawed

relevance fallacies

involve introducing information that is unrelated to the issue at hand, distracting from the core argument

• these fallacies derail logical reasoning by shifting focus to
  emotionally charged or tangential points.

• Common examples include red herrings, appeals to popularity, and ad hominem attacks.
  

Missing the point

This fallacy occurs when an argument supports a conclusion — but not the one actually drawn. The reasoning may be valid, but the conclusion doesn’t follow from it, creating a disconnect between
evidence and claim.

• For example, arguing that crime is rising and therefore we should ban video games misses the point if no link is established.

Ad hominem fallacy

Involves attacking the person making an argument rather than
addressing the argument itself. It shifts focus from the merits of a claim to the character, motives, or background of the speaker.

• For instance, dismissing a scientist’s findings because of their political
  views

straw person fallacy

occurs when someone misrepresents an opponent’s argument to
make it easier to attack. Instead of engaging with the actual claim, they refashion it into a weaker version and refute that.

• For example, if someone argues for environmental regulation and is accused of
  wanting to shut down all industry

Red herring fallacy

introduces an irrelevant topic to divert attention from the original issue.
It’s a deliberate or unconscious distraction that shifts the conversation away from the central argument

• For example, in a debate about school funding, bringing up teacher dress codes is a. This
  fallacy is common in politics and media.

Appeals to fear

threats or frightening scenarios to persuade rather than relying on logical
reasoning. While fear can be a legitimate concern, manipulating it to override rational thought is a fallacy.

• For instance, claiming that without a certain policy, society will collapse, without evidence

bandwagon fallacy

assumes that because something is popular, it must be right or good. It
equates widespread acceptance with truth, ignoring the possibility of collective error or cultural bias

appeal to tradition

fallacy argues that something is right or better simply because it has always been done that way. It assumes that longevity or historical precedent is a sufficient justification for continuing a practice.

appeal to emotion

ccurs when arguments rely on manipulating feelings rather than presenting
logical reasons. This fallacy can involve fear, pity, anger, or pride to sway opinions without addressing the actual issueue.

appeal to/from authority

ccurs when someone claims a statement is true because an authority figure says
so — even if the authority is not an expert in the relevant field. It can also involve dismissing valid
arguments simply because they come from a non-authority.

• For example, citing a celebrity’s opinion on climate science
  

sunk cost fallacy

involves continuing a course of action because of past investments
(time, money, effort), even when future costs outweigh benefits. It reflects a reluctance to “waste” what’s already been spent, even if cutting losses is wiser.

fallacy of division

assumes that what is true of a whole must also be true of its parts. It
mistakenly attributes collective properties to individual components.

• For example, assuming that
  because a team is excellent, each member must be outstanding, commits this fallacy
  

fallacy of composition

Reverse of the division fallacy: it assumes that what is true of
the parts must be true of the whole. This can lead to overgeneralization or faulty aggregation.

• Forinstance, believing that because each player on a team is talented, the team will be unbeatable ignores dynamics like teamwork and strategy

Presumption fallacy/false alternative

occurs when an argument presents a limited set of options and ignores other viable
possibilities — a false dilemma. It pressures decision-making by framing choices as either/or when the
reality is more complex

• For example, saying “you’re either with us or against us” excludes neutral or
  alternative positions.

errors of probabilistic reasoning

involve flawed understanding or application of probability. They include
overestimating rare events, underestimating compound risks, and misinterpreting randomness.

• For example, assuming that a rare event is “bound to happen soon” reflects poor probabilistic reasoning. These errors are common in gambling, forecasting, and risk assessment.

conjunctive event bias

tendency to overestimate the probability of a series of events all
occurring together. People often assume that multiple steps are more likely than they actually are.

• For
  example, believing that a project with many dependent tasks will finish on time underestimates the risk
  of delay. This bias is important in planning and project management.

disjunctive event bias

tendency to underestimate the probability that at least one of
several events will occur. People often fail to appreciate how multiple independent risks add up.

• For instance, underestimating the chance that at least one component in a system will fail ignores cumulative risk.

teleological

acts based on consequences, outcomes

deontological

acts based on rights and duties from natural law, logic, reasont

theological

acts based on rights and duties from divine revelation, religion

aretaic

judge acts for consistency with virtues or character traits for living a good life and flourishing based on practical wisdom

cultural

acts based on socially agreed-upon norms

utilitarianism

(teleological)

• maximize utility

• weigh overall costs and benefits for those affected

• Strengths:
  1.Easy to articulate standard of conduct
  2.Maximizes social utility
  

Weaknesses:
1.Difficult to measure and compare utility (especially
short-term vs. long-term)

rights theory

• Deontological: Judge act by rules based on fundamental
  rights and duties, based on natural law, logic, and reason
  

  • E.g., rights to life (duty not to harm), free expression
    (duty to allow expression), equality (duty to treat
    fairly, not discriminate), etc.
    

  • Universality (first categorical imperative)
    

  • Treat people as ends and not means (second
    categorical imperative)
    

  • Reciprocity (treat others as you want to be treated)
    (e.g., “Golden Rule”)

virtue theory

• Aretaic: Judge acts for consistency with virtues or character traits
  for living a good life and flourishing

• Recognizes virtues are shaped by community, social contexts
  

  • Strengths
    1. Encourages character development
    2. Flexibility in complex situations
    3. Integrates emotion and reason
    4. Supports human flourishing
    

  • Weaknesses:
    1. Lacks clear decision rules (what a virtuous person would do can be vague)
    2. Disagreement about virtues (including cultural differences)

    
    

Justice Theory

• Deontological & Teleological: Judge acts based on
  fairness and equality (as human rights and duties and in
  outcomes)

  • Rawls’ “Greatest Equal Liberty Principle”: A person
    has an equal right to the same basic rights and
    liberties

  • Rawls’ “Difference Principle”: Inequality is
    acceptable only if it can’t be eliminated without
    making the worst-off even worse off

  • Veil of Ignorance: “Original position” ignorant of your
    interests