Do Good Intentions Pay Off? Employee Responses to Well-Intended Actions with Risky Outcomes

Bibliographic Data

ID19446520
AuthorsAndreas Ostermaier (0000-0001-9143-5103, University of Southern Denmark, corresponding author), Peter Schafer (0000-0002-3880-0850, Technical University of Munich)
Year2024
Volume33
Issue1
Pages313-334
Publication date2024-01-01
Open AccessNo
TypeARTICLE
VenueEuropean Accounting Review (JOURNAL)
Journal identifiersISSN: 0963-8180 • E-ISSN: 1468-4497
PublisherInforma UK Limited (PUBLISHER • GB)
DOI10.1080/09638180.2022.2085132
OpenAlexW4283262040
LanguageEN
Citations received1
References cited47

How does a subordinate react to the superior’s well-intended action when it is not certain that it will produce the intended outcome? The risk associated with the outcome creates moral wiggle room and thus poses a threat to the gift exchange between the superior and the subordinate. In a laboratory experiment, we first find that subordinates continue to reciprocate if the outcome risk is high. Second, however, subordinates’ response to a well-intended action that increases outcome risk depends on their inequality aversion. Weakly inequality-averse subordinates repay a kind action with a kind reaction if it decreases, but not if it increases, their outcome risk, whereas strongly inequality-averse subordinates react alike in both cases. Hence, a well-intended action is less worthwhile for subordinates if it increases than if it decreases outcome risk

Economics · Expected utility hypothesis · Financial economics · Inequality · Inequity aversion · Microeconomics · Culture, Economy, and Development Studies · Experimental Behavioral Economics Studies · Psychology · Psychology of Moral and Emotional Judgment · Social Psychology

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