Do Good Times Breed Cheats?: Entering the Workforce in a Boom Predicts Later Unethical Behavior

Bianchi, E and Mohliver, A (2014) Do Good Times Breed Cheats?: Entering the Workforce in a Boom Predicts Later Unethical Behavior. [Conference proceeding]

Abstract

In this paper, we examine whether strong environmental circumstances at an impressionable stage of life will have lasting implications for ethical behavior. Drawing on work showing that perceptions of financial abundance increase the likelihood of ethical transgressions as well as imprinting work suggesting that early career conditions can leave a lasting mark on later career behavior, we propose that entering the workforce during an economic boom will increase the likelihood that people will engage in ethically questionable practices later in their careers. Using a large sample of American executives between 1996 and 2005, we find that those who began their careers in economically prosperous times were more likely to backdate stock options later in their careers. While past work has shown that contextual cues affect the likelihood of engaging in unethical behavior, the present findings suggest that strong environmental conditions at a formative period of life can affect ethical impulses for a long time to come.