2. KANT’S CATEGORICAL IMPERATIVE UNIVERSAL PRINCIPLE –A person should act that the principle of one’s act could become a universal law of human action in a world in which one would hope to live. –A person should treat other people as having intrinsic value, and not merely as a means to achieve one’s end.

3. CONTRACTARIAN DEONTOLOGY John Locke –Each individual has inalienable natural rights. The purpose of society is to protect these rights Rawls (Veil of Ignorance) –Social Justice is created when rational people would formulate rights if they did not know whether or not these principles would apply to them.

4. CRITICAL QUESTIONS? DO ALL HUMANS HAVE POTENTIAL FOR GREATNESS? WHAT ARE SOME OF THESE POTENTIALITIES? ARE PEOPLE SOCIAL BY NATURE ?

5. HUMAN NATURE ETHICS ARISTOTLE –All humans share innate capacities and desires. All Humans are social creatures and therefore have the capacity to become excellent members of society. This is done by studying, becoming wise and participating in politics. –Negative behavior is a result of not being allowed to reach full potential

6. BUSINESS ETHICS AND ECONOMIC SENSE Adam Smith –The Wealth of Nations It is not from the benevolence of the butcher, the brewer,or the baker that we expect out dinner, but from their own interest. We address not heir humanity but their self- love

7. ADAM SMITH IN The Theory of Moral Sentiments There is a need to go beyond profit maximization to: humanity, justice, generosity, and public spirit.

8. ECONOMIC INSTITUTION’S FOUNDATIONS Common Behavior Patterns Shared Trusts Mutual Confidence

9. OTHER FORMS OF CAPITALISM Japanese Ethos –Honor –Duty Confucian –Hard Work –Thrift –Family

10. Public Good All Benefit Non-Competitive One’s Consumption does not exclude another EXTERNALITIES Public Ownership Public Regulation Public Concern in Private Decisions

11. CRITICAL QUESTIONS? WHAT IS TRUTH? WHAT IS A LIE?

12. TRUTHFULNESS Emmanuel Kant 1771 TRUTH TELLING LEADS TO DISCOURSE WHICH LEADS TO FELLOWSHIP WHICH LEADS TO FORMATION OF A SOCIETY

13. GENERALLY TO LIE IS EVIL AND TO BE A LIAR IS TO BE A COWARD SILENCE –Not an option because it is view as unsocial SECRETS –Telling secrets is like giving presents and a nature inclination. Strength is in keeping them. TRUTH –Important because one of two way to gain knowledge. The other is experience.

14. LIE –When giving impression that you are telling the truth FALSE STATEMENTS OK WHEN –Other person does not have the right to demand the truth –Other person may make wrong use of the truth –Other person may harm you FLATTERY –Can be act of kindness (weakness) or treachery FAULT FINDING –OK for someone in authority when used with love, goodwill, or sweetness SPYING –We have no right to spy on others ANY ACT THAT WORKS AGAINST FRANKNESS LOWERS THE DIGNITY OF HUMAN KIND

15. CRITICAL QUESTIONS? IS IT APPROPRIATE FOR BUSINESS TO HAVE ITS OWN ETHICAL RULES?

16. Is Business Bluffing Ethical? Albert Carr (1968) BUSINESS IS A GAME WITH ITS OWN ETHICS FALSEHOOD IS NOT FALSHOOD WHEN TRUTH IS NOT EXPECTED BY THE OTHER SIDE THE GAME PRESSURES PEOPLE TO DECEIVE. DECEPTION MUST BE WITHIN LIMITS OF THE RULES OF THE GAME (LAW)

17. ETHICS ARE OF VALUE WHEN THEY ADD VALUE TO THE BUSINESS TO WIN ONE MUST PLAY TO WIN THERE ARE BOUNDARIES TO BEHAVIORS AND DEFINITIONS OF HONESTY, INTEGRITY AND DECENCY WITH THE GAME.

18. CRITICAL QUESTIONS? WHAT ARE THE BASIC “SETTLED” ETHICS IN BUSINESS DEALINGS? WHAT ROLE SHOULD GOVERNMENT (POLITICS PLAY)?

19. LIMITS OF BUSINESS ETHICS Joseph Betz (1999) INFORMAL –You may do unto others what experience teaches us they might do to us. FORMAL –Law

20. BUSINESS AND LAW SINCE THE ETHICAL BAR IS SO LOW, SOCIETY MUST CONSTANTLY WRITE LAWS REGULATING BUSINESS.

21. CRITICAL QUESTIONS? How much should you trust another in business negotiation? Is the market place established as a place to deceive others?

22. Promoting Honesty in Negotiations Cramton & Dees Foundation Theory –Most people place a high value on their own welfare –There is weakness in all of us –Others will behave ethically only if they expect others to do the same

23. NEGOTIATION FALSE IMPRESSIONS PRIVILEDGED ACCESS TO INFORMATION USE OF THREATS AND PROMISES UNDISCLOSED SETTLEMENT PREFERENCES

24. Factors Affecting Honesty Asymmetry of Information Verification is Difficult Intention to Deceive is difficult to establish Insufficient resources Interaction is infrequent Ex Post redress is costly Reputation information not available Unique circumstances To much to lose to be honest

25. LIMITING DECEPTION VERIFY CLAIMS DEVELOP CONTRACTS (Warranties/ Bonds/ \Escrow) PRESERVATION OF REPUTATION LIMIT MORAL HAZARDS (Shirking Responsibilities)

26. REAL WORLD LIMITS Legal and Regulatory Protection Institutional Verification Available Standard Contracts Third Party Negotiators Credentials Individuals Available

27. PREPARING FOR NEGOTIATIONS Determine incentives for deception Determine character of other side Determine your attitudes toward issues and others

28. BUILDING TRUST Face to Face Contact Create opportunities to display trust Demonstrate your trustworthiness Place negotiations in long term context Bring in trusted intermediaries Self Protection