Does doing good give you creative ways to make money license to be bad (ep. 335) – freakonomics freakonomics

Is that really why so many firms practice C.S.R.? Many businesses, large and small, surely are populated by people with good intentions and pure creative ways to make money hearts. But you can also imagine some less-than-pure reasons for a company to embrace C.S.R. Maybe to make itself more appealing to customers or to creative ways to make money shore up a fragile or damaged reputation. Maybe even to balance out some questionable business practices. One of john list’s predecessor economists at the university of chicago was skeptical creative ways to make money about C.S.R. On an almost existential level:

LIST: it actually has really interesting roots that take you all creative ways to make money the way back to the 19th century in great britain, when there was some social unrest around issues like poverty, working conditions, and child labor. And soon after that, businesses responded with what I would call an industrial-welfare movement. And it’s still hotly debated whether those actions were profit-motivated, socially motivated, or both. And I like to go out and say, “okay, why are people doing what they’re doing, and does it make the world a better place?”

LIST: that’s where I started my focus, asking questions like: “are people more likely to work for a C.S.R. Firm?” or “do they work harder?” or “do they pay more attention to quality?” and when you ask those questions, then you step back and say, “well, where are the firms I can partner with to try creative ways to make money to explore these questions?” and then it’s very difficult to find research partners.

DUBNER: let me make sure I understand this. You’re saying you have these — what strike me as really interesting and good questions about creative ways to make money the effects of C.S.R., and I guess what you’d want to do then is come in to, let’s say 10 firms and randomize them, and then do a bunch of stuff, but you couldn’t get firms to let you do that, is that what you’re saying?

LIST: exactly, exactly. So you have an idea, and then you say, “well, how are we going to carry this out? I really don’t want to do it in the lab, because I don’t really think that students act like firms, but I want to do it.” you can either partner with a firm or you can creative ways to make money take matters into your own hands and create your own creative ways to make money firm and hire real people and see exactly if people creative ways to make money do respond to C.S.R. Incentives.

LIST: essentially, what we’re going to do is we’re going to hire people to look at snapshots from creative ways to make money google street view, and they’re going to enter the characteristics of those blocks. So, we’re going to do this for uber and do this creative ways to make money for chicago heights elementary schools as well. There are actually real clients, and we need to hire real people to get the creative ways to make money google street view into some text formats. Now, the next step, of course, is, “how are you going to hire people and run this creative ways to make money as a field experiment?” and what we did was we placed online job ads creative ways to make money on craigslist in 12 cities around the states. And to explore exactly what are the effects of C.S.R., what we did is across those different job ads, we varied the wages from $11 to $15 per hour. And we also varied whether the firm was a C.S.R. Firm or not.

C.S.R., it turns out, is a great sorting mechanism to attract not only more creative ways to make money potential employees but a better class of employees — who’ll work harder for less money! What’s not to like? Well, john list, being an economist, looks at the world in terms of costs and benefits. Is it really possible for something with so many benefits creative ways to make money to have no costs? So he and some colleagues ran a second experiment. With the following question in mind:

LIST: we did begin with an idea that it’s possible that this could work. And what I mean by “working” is that C.S.R. Could make people work harder for us, kind of like in our in our first piece of creative ways to make money research. But we also wrote down a theory where there’s this more nefarious channel, where people will actually use that C.S.R. As a license to do a bad thing.

Why do the vast majority of companies, who are in the business of making money, also put so much emphasis on giving money away and creative ways to make money being good corporate citizens? There are probably a lot of reasons. For one, maybe they just are good citizens. We don’t have to be cynical about every behavior, do we? But the economist john list, using a field experiment with a real company that he creative ways to make money set up, found that C.S.R., or corporate social responsibility, also attracts more and better employees. But he also wondered if perhaps there’s a downside to C.S.R. To find out, he set up a second experiment.

LIST: yes, when you look at employee theft of either money or creative ways to make money goods and services, it is actually enormous. It’s in the billions of dollars every year. Employees steal much more money than bank robbers from banks. Sometime we talk about bank robbers are bad. If you really want to save your money in a creative ways to make money bank, you should be watching out for employees, not bank robbers. When you look at data from hospitals — you just have a tremendous, tremendous amount of employee theft out there in our modern creative ways to make money economies.

LIST: unfortunately for my firm here and for humanity, that’s certainly not what emerged. What emerges is that many more people end up cheating creative ways to make money and reporting that these images are unreadable. And, in fact, roughly 24 percent more employees, when they’re in C.S.R., end up doing this fundamental misbehavior in the workplace of creative ways to make money saying that the images are unreadable when they really are creative ways to make money readable.

LIST: what this cheating suggests is that there’s something else going on within the C.S.R. Incentive that is much deeper than what my initial inclinations creative ways to make money had me believing. My initial inclination is: firm does a good thing; worker reciprocates to firm by working harder; and the world is a better place. Everyone’s better off. But what this suggests is that there’s something deeper on the psychological side, that it’s not just triggering this reciprocity from workers. C.S.R. Is also triggering something deeper, which the researchers in this area call moral licensing.

EMILY I used to do some pretty spectacular moral licensing creative ways to make money when I worked at a local supermarket as a checkout creative ways to make money girl. And I was pretty known for delivering exceptional customer service. I would be a personal concierge to little old ladies creative ways to make money doing their shopping, and the stacking was always absolutely perfectly in line and creative ways to make money color-coded. But I also imposed my own little tax on people creative ways to make money who came through my checkout and were rude to me, which was quite often. I would shortchange them by a couple of dollars and creative ways to make money keep a little tally at my till, until the end of my shift, when I would usually have an extra $20 to $50, and up my sleeve that note would go while I creative ways to make money was doing my count. So yeah, that’s some pretty naughty moral licensing.

BARTLEY: I’ve always felt like the profession of physical therapy is creative ways to make money a little undervalued in the medical community, and we’re a little underpaid as well. So, I thought it was okay, I used that to make my own moral equation, and convince myself that it was okay to steal cheese. I used to go to the fancy grocery stores and creative ways to make money pay for everything except for the fancy cheese that I creative ways to make money would stuff in my pockets. And, in fact, I once dated a girl who broke up with me creative ways to make money for two reasons. One was that she thought that I was just a creative ways to make money little too quick to want to make a family and creative ways to make money have babies. And, number two, she couldn’t handle the fact that I stole cheese. So, of course, I’ve grown up a little bit and stopped stealing cheese, but I still feel a little disenfranchised every now and creative ways to make money then.

TILLEY: the moral licensing that goes on among white people working creative ways to make money in developing countries is astounding. Malawi is one of the poorest countries on earth. And yet, people who work in development, who are ostensibly trying to improve the situation, in their day-to-day lives have no problem haggling over vegetables, for example, have no problem engaging in corruption when it comes to creative ways to make money obtaining permits or licenses. But when it comes to actually making sure that their creative ways to make money staff or the people they interact with are paid a creative ways to make money fair salary, they take a fairly hefty slice of moral licensing, I guess, because they assume that they’re doing good in their jobs, so it doesn’t matter if they take a bribe or pay a creative ways to make money bribe or pay 35 cents rather than 40 cents for creative ways to make money carrots.

EFFRON: so, people are torn. On the one hand, we want to feel like reasonably ethical human beings. And on the other hand, we face a lot of temptations that would take us creative ways to make money away from our ethical values, or at least temptations to act in ways that could creative ways to make money call our morality into question. And so people need to do this dance to balance creative ways to make money those competing forces. They act in morally inconsistent ways. Moral licensing is one way that people balance those forces creative ways to make money and enable themselves to not always act perfectly virtuously.

EFFRON: so, I’m a new grad student, I’m talking with a colleague of mine named jessica cameron creative ways to make money about the election, and we observe that, very soon, millions of americans are going to go to the ballot creative ways to make money box and express their support for the first african-american presidential candidate nominated by a major party. And we wondered, what’s the psychological effect of this going to be? Could there be any ironic consequences?

EFFRON: – called “ moral credentials and the expression of prejudice ,” showing that when people express a non-prejudiced view, they subsequently feel more comfortable expressing other views that could creative ways to make money seem prejudiced. And we wondered, “could expressing support for obama have a similar effect?” so we ran some studies on the stanford campus.

EFFRON: we collected data from stanford undergraduates. All of them were obama supporters. And half of them, we gave them an opportunity to identify themselves as obama creative ways to make money supporters. And the other half we gave them no such opportunity. Then we asked them a difficult question. We asked them to imagine that they were the chief creative ways to make money of police in a small town where racist attitudes against creative ways to make money black people are common. And we said, “it’s time to hire a new officer. Do you think this job is better suited for a creative ways to make money white person, for a black person, or do you think race shouldn’t be an issue in this decision?”

EFFRON: so, what we found is, when people had no opportunity to express their support for creative ways to make money obama, the vast majority of them went with the safe answer. They said, “I don’t think race should be a factor in this hiring creative ways to make money decision at all.” but when people had an opportunity to express their support creative ways to make money for obama, they subsequently were more likely to say that they would creative ways to make money rather hire a white person than a black person for creative ways to make money the job. They were more likely to express this ambiguous view that creative ways to make money could seem prejudiced. By endorsing obama, they’ve credentialed themselves, in their eyes, as a non-prejudiced individual, so they can express this ambiguous view without fear of creative ways to make money feeling or appearing prejudiced.

LIST: if you’ve just given money to a charity, you’re now more likely to cheat a bit on your creative ways to make money taxes. So, when you think about what the federal government does, they play right into our hands when on our tax creative ways to make money forms they have us list our charitable gifts. Now, what the literature suggests is that merely being reminded of creative ways to make money a good deed can actually induce you to misbehave on creative ways to make money other dimensions.

DUBNER: let me ask you this: when you describe moral licensing, it resonates, at least with me. But, just as easily, the opposite could resonate for me. In other words, if you had told me, “when I do a positive or a pro-social behavior, then I kind of give myself permission to do something creative ways to make money a little bit antisocial or selfish, right?” but I could also imagine you saying that when I creative ways to make money do a pro-social behavior, habit formation being what it is — and there’s a ton of psychology on that — it should lead to more. I’m just curious if that strikes you as at all creative ways to make money contradictory or potentially contradictory?

LIST: I think potentially, absolutely. Do a good deed here, you’re more likely to do a good deed tomorrow. Now, the data by and large don’t suggest that that’s true. Now, that’s not to say that there aren’t good types and bad types. I think we need to differentiate this argument. So, one case is, you have people who tend to do good things. And you have other people who tend to do bad creative ways to make money things. That’s certainly true. What this is saying is that, let’s take a good person and remind them that, you know what, you’ve just done these three really good behaviors, versus taking an identical good person and saying nothing. It’s more likely that tomorrow the person who you reminded creative ways to make money that they were doing good will actually do something bad creative ways to make money versus not reminding them. That’s the important thing to recognize what the literature suggests.

There’s one more potential consequence to all the C.S.R. That firms are practicing, a really big one: political influence. A recent working paper by four economists looked at corporate creative ways to make money philanthropy as a form of what they call “tax-exempt lobbying.” they found that firms increase their charitable donations in congressional creative ways to make money districts when those districts’ representatives get seats on committees that are relevant to the creative ways to make money firms’ business. How much money are we talking about here? The economists write , “our estimates imply that 7.1 percent of total U.S. Corporate charitable giving is politically motivated, an amount that is 280 percent larger than annual PAC creative ways to make money contributions and about 40 percent of total federal lobbying expenditures.” so, that’s not nothing. And it feels like we should talk about this topic creative ways to make money some more. But maybe, rather than from the economist’s perspective, it should be from the perspective of the companies themselves. Wouldn’t it be nice to hear about corporate social responsibility creative ways to make money from a company that takes C.S.R. Really seriously?

Freakonomics radio is produced by WNYC studios and dubner productions. This episode was produced by greg rosalsky . Our staff also includes alison hockenberry , merritt jacob , stephanie tam , max miller , harry huggins , and andy meisenheimer ; we had help this week from louis mitchell. The music you hear throughout the episode was composed by creative ways to make money luis guerra . You can subscribe to freakonomics radio on apple podcasts , stitcher , or wherever you get your podcasts .

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