e-mail: t.m.van.der.vaart@student.rug.nl

Master thesis, Msc HRM, specialization Human Resource Management University of Groningen, Faculty of Economics & Business

March 22, 2012

TRIJNTJE MARIANNE VAN DER VAART Studentnumber: 1648268

Flecht 14 9103 PH Dokkum

e-mail: t.m.van.der.vaart@student.rug.nl

Supervisor University of Groningen L.B.Mulder@rug.nl

Acknowledgment: helpful comments on this thesis were given by dr. L.B. Mulder.

ABSTRACT

Inspired by the general knowledge that words can condone bad deeds, this paper studied the role of rationalizations people make in order to justify their immoral behaviors, in immoral behavior escalation. Research suggested that moral rationalizations influence the escalation of immoral behavior. In this research it is aimed to test whether, how and under what conditions unethical organizational behaviors may escalate. Participants were asked to imagine they are working in an organization for which they proclaimed more expenses than they actually spent or imagined that they proclaimed expenses what they actually spent. Then they had to make either moral rationalizations or counter moral rationalizations about claiming too much. In the subsequent situation the participants had to declare another receipt.

In one condition the amount of the receipt was higher than the previous situation (escalation), and in the other condition the receipt was lower than the previous situation (de-escalation).

The results demonstrated that people in an escalating situation tend to act more moral than

people in a de-escalating situation. The relationship between previous and future behavior was

moderated by moral rationalizations. By making moral rationalizations, people acted more

unethically than their previous behavior.

INTRODUCTION

Although fraud is considered as a criminal offence, people who commit fraud often appear to be “ordinary people” (Anand, Ashforth, & Joshi, 2004). An example of an organization where ordinary organizational members engaged in corrupt behavior is Enron.

This organization started out to be known as a principled organization until 2001. In 2001 Enron was declared bankrupt. One of the reasons for this bankruptcy was that the employees of the organization hid the losses for the shareholders. In 2002 Enron was sued for fraud. This example shows how organizations, even when they were known as an ethical organization, may gradually develop into one in which employees engage in corrupt behaviors (Gino &

Bazerman, 2009; Zyglidopoulos, Fleming & Rothenberg, 2009). This research focuses on the question whether, how and under what conditions unethical organizational behaviors may escalate. It addresses the question how small immoral behaviors may escalate into larger ones.

Little empirical research has been done on this. Inspired by the general knowledge that words can condone bad deeds, this paper studies the role of rationalizations people make in order to justify their immoral behaviors, in immoral behavior escalation.

Escalation

Tsang (2002) defines escalation as the increased likelihood and intensity of further evil behavior. In this paragraph it will be explained how immoral behavior can escalate. Literature suggests two mechanisms by which escalation of immoral behavior can occur: escalation of commitment and the slippery slope of decision making (Arkes & Blumer, 1985; Gino &

Bazerman, 2009; Martens, Kosloff & Jackson, 2010; Singer & Singer, 1986; Street & Street, 2006; Tenbrunsel & Messick, 2004; Ting, 2011; Tsang, 2002; Zyglidopoulos, Fleming &

Rothenberg, 2009).

The first mechanism of escalation is escalation of commitment. With escalation of commitment people continue a decision even when there is clear evidence the decision is wrong (Robbins & Judge, 2012). An illustration of escalation of commitment is the sunk cost effect. Sunk costs are costs that already have been made and cannot be undone. Normally, decisions of people should not be based on the sunk costs of the course of action. Decisions should be based on expected incremental costs and investments. If people base their decision on the sunk costs, this behavior is considered as economic irrational (Arkes & Blumer, 1985;

Ting, 2011). By irrational decision-making people remain investments in the decision to

which they are already committed (Ting, 2011). The sunk cost effect implies that once people

made an investment in money, time or effort, they tend to continue that decision (Arkes &

Blumer, 1985). The following case can be considered as an example of the sunk cost effect.

Someone bought a ticket for a soccer game for €27,-. As he was preparing to go to the soccer game, a terrible snowstorm began. The trouble of defying the snowstorm would be greater than the enjoyment the soccer game would provide. He cannot sell his ticket anymore.

Rationally this person should not take the paid ticket into account. The costs have already been made and have no impact on the decision whether or not to go to the game. However, often people tend to go to the game, because they (irrational) argue that it would be a waste of their ticket (invested money).

In ethical decision-making the sunk cost effect also appears. One of the reasons why people continue unethical decisions is that quitting would mean that one accepts that the prior decision was wrong or wasted. Admitting an unfortunate decision leads to a psychological feeling of discomfort. By staying committed to the unethical decision, someone will not perceive this as a waste of time or effort and the psychological discomfort will not occur.

Commitment to an unethical decision increases the chance of further unethical behavior (Singer & Singer, 1986; Street & Street, 2006; Ting, 2011; Tsang, 2002).

Martens, Kosloff & Jackson (2007; 2010) illustrated escalation of commitment. They demonstrated that commitment was the driving force for repeated killing of bugs. In their experiment people had to put bugs in an “extermination grinder” (a modified coffee grinder) at their own pace. Initially the participants had to put either one or five bugs in the grinder. In advance, half of the participants were told that they were actually killing the bugs and the other half knew they were not killing the bugs. The results showed that the killing of five bugs led to more subsequent killing than generalizing killing of just one bug. The explanation for this effect is cognitive dissonance. By killing one bug people showed less cognitive dissonance. So, commitment and not practice, was the reason of an increase in subsequent killing after initial killing of five bugs (Martens, Kosloff & Jackson, 2010).

The other process that explains escalation of immoral behavior is the slippery slope of

decision making. The slippery slope of decision making consists of two psychological

mechanisms: ‘psychic numbing’ and the ‘induction mechanism’ (Tenbrunsel & Messick,

2004). ‘Psychic numbing’ can be a reflex response to overwhelming fear or pain. If someone

is exposed to an extreme painful situation several times, it is impossible to experience the

same intense pain as the first time it happened. So, the initial impact of suffering decreases

with frequent exposure. In the context of ethical decision making, frequent experience with

unethical actions may create a form of ‘psychic numbing’ in which the feeling of guilt

decreases by this repeated experience. By ‘psychic numbing’ is the individual less able to

recognize the immoral behavior. This may increase chances of escalation (Tenbrunsel &

Messick, 2004).

The last process by which escalation may occur is the ‘induction mechanism’. People use actions from the past as a benchmark for evaluating actions in the future. Some activities are only little more unethical than people’s previous (ethical) activities. So, if the behavior was ethical in the past, then slightly different behaviors are also perceived as ethical by the individual. Immoral behavior can turn into routine if it develops step by step over time. As a result individuals will gradually make less moral decisions each time, and will not see the immorality of their actions ending up in clearly immoral actions (Gino & Bazerman, 2009;

Tenbrunsel & Messick, 2004; Tsang, 2002; Zyglidopoulos, Fleming & Rothenberg, 2009).

The ‘boiling frog’ is a metaphor from the 19 ^th century for the ‘induction mechanism’.

If you put a frog in a pan with boiling water, he will immediately jump out of the pan. But if the frog was put in a pan with warm water, which was gradually heated, he will snooze happily like someone who is taking a bath. Due to the insensitivity for the gradually heating water, the frog will not leave and will be cooked till death (Gino & Bazerman, 2009; Senge, 1994). This metaphor illustrates that by small changes in the environment, the frog does not realize he is in danger and is not stimulated to take action. The same insensitivity for gradually changes applies to people. In case of gradually changes in decision-making, people are not able to see that their moral actions change slowly into immoral actions (Gino &

Bazerman, 2009).

In an ethical dilemma people have to compromise between moral principles and self- interest. In a situation that is considerably different than the previous situation it is clearer for people that one will engage in an immoral act. Conversely, in a situation that is slightly different than the previous situation the incremental steps hide the moral components of a decision. Psychological processes fade the ethics from an ethical dilemma. Thus, people tend to behave more unethical in a slightly different situation than in a considerably different situation (Singer & Singer, 1986).

All in all, there are several reasons to expect that once people crossed the border of unethical behavior, they continue to behave unethically. This can be due to the processes

‘escalation of commitment’ and/or ‘slippery slope of decision-making’. This does not

necessarily mean that they also show more serious forms of unethical behavior. By escalation

of commitment one is primarily committed to the behavior that is shown. This explains why

people continue immoral behavior but not necessarily why they would escalate into more

serious forms of unethical behavior. By ‘psychic numbing’ one gets immune for what already

is done. To show the same behavior in the same or a lesser degree is easier because one is insensitive for this behavior. Although it makes it also easier to go a step further, showing the same behavior is even more easy. By the ‘induction mechanism’ immoral behavior can turn into routine if it develops step by step over time. Incremental steps hide the moral components of a decision. This does make it easier to show further immoral behavior. Nevertheless, it is to be expected that people will be more likely to continue unethical with actions that are less serious than their previous immoral act than with action that are more serious than their previous immoral acts. Based on this reasoning, the first hypotheses are:

Hypothesis 1: when people initially acted immoral they are more likely to show further immoral behavior, than if people initially acted moral.

Hypothesis 2: when people initially acted immoral they are more likely to show further immoral behavior, than if people initially acted moral. This is less true if the second situation is more serious the initial situation than if the second situation is less serious than the first situation.

Does previous unethical behavior always result in escalation? The above paragraphs suggested that, once people have engaged in an immoral act, they continue to do so and may even escalate into more immoral forms. However, recent research also shows that people, after engaging in an immoral action, will act morally in order to compensate for the immoral behavior. The explanation for this is that people do things that create a sense of self-worth.

Violation of the moral standards will harm this sense of self-worth (Bandura, Barbaranelli, Caprara & Pastorelli, 1996; Sachdeva, Iliev & Medin, 2009). As a result people will behave more moral to compensate for this loss of self-worth. So, it has been argued that in making decisions, people take the ethicality of previous decisions in consideration. If the previous behavior was unethical and harmed the self-worth, the next behavior will be ethical to compensate for the loss of self-worth (Sachdeva, Iliev & Medin, 2009; Zhong, Ku, Lount, &

Murninghan, 2010).

All in all, literature is suggesting that people continue to engage in an immoral act or

may even escalate, but also may compensate for the immoral behavior. To investigate the

effects of previous behavior on subsequent behavior a focus is necessary. The focus of this

paper will be on when immoral behavior is followed by more immoral behavior. Therefore, it

should be tested what moderates the effect of previous immoral behavior on subsequent

behavior. In this paper the focus is on the moderating role of moral rationalizations.

Moral Rationalization

When people make moral rationalizations, actions are described in such a way that they do not appear to be unethical at all (Anand, Ashforth, & Joshi, 2004; Zyglidopoulos, Fleming & Rothenberg, 2009). People can rationalize their behavior in different ways by:

moral justification, euphemistic language, advantageous comparison, displacement of responsibility, disregarding or distorting the consequences and attribution of blame (Bandura, Barbaranelli, Caprara & Pastorelli, 1996). Next, the different ways of rationalizing behaviour will be explained.

A way of rationalizing behavior is making moral justifications. By moral justifications the immoral behavior is made acceptable with representing it as an appreciated social or moral principle. For instance, the U.S. government that represented the Iraq invasion as a contribution to the democracy in that country. Another type of a moral rationalization is euphemistic language. With euphemistic language people can mask their unethical behavior.

People’s behavior is influenced by how activities are called. Different names for the same activity can result in different behavior. An example of euphemistic language is that in military campaigns one speaks of “collateral damage” instead of civilian deaths. A different type of a moral rationalization is advantageous comparison. By advantageous comparison people compare their immoral behavior with more severe immoral actions. As a result it is more likely that their actions will appear to be benevolent, for example the atomic bombs attack at Hiroshima and Nagasaki. People believe that this attack at limited Japanese citizens saved the lives of thousands American citizens. An alternative way of a moral rationalization is displacing responsibility. Displacing responsibility implies that someone is convinced that he acts immorally because he did not had a choice to behave in a different way. Because someone is not the actual driving force of the action, he can displace his responsibility and is more likely to act immoral. For instance the Nazi’s who were “just following orders” of Hitler to gas all the Jews in the concentration camps. Another kind of a moral rationalization is disregarding or distorting the consequences. With disregarding or distorting the consequences someone trivializes the consequences. An example of disregarding or distorting the consequences is someone who proclaims more than he had paid for a business dinner, under the guise of that the organization will not go bankrupt of one proclamation. The last type of a moral rationalization is attribution of blame. By attribution of blame people shift the blame to others. For example, a used car dealer who, after selling a car with a broken taillight, feels less guilty because the customer did not ask for defects (Anand, Ashforth, & Joshi, 2004;

Bandura, Barbaranelli, Caprara & Pastorelli, 1996).

Justifying immoral actions will keep the actions of the person in line with his internal standards of satisfaction and self-worth. Thus, normally people do not engage in immoral behavior until they have justified to themselves the correctness of their behavior. In other words, they rationalize their immoral behavior (Bandura, Barbaranelli, Caprara & Pastorelli, 1996; Sachdeva, Iliev & Medin, 2009). It has been argued that by making moral rationalizations the individual can justify the immoral action and will not lose self-worth (cover the costs) and will stay committed to the previous action (Singer & Singer, 1986;

Street & Street, 2006; Tsang, 2002). Making moral rationalizations is an alternative for the compensation of the loss of self-worth.

Moral rationalizations can take the place of compensation behavior. Moreover, moral rationalizations can pave the way for further immoral behavior. A reason why moral rationalizations may stand in the way of compensation is that unethical activities can be a result of step-by-step moving away from moral behavior, and moral rationalizations may make these steps bigger. Zyglidopoulos, Fleming & Rothenberg (2009) argued that moral rationalizations are often bigger than the previous unethical action, so that a gap exists. An example of moral rationalizations that leaves a gap occurred at WorldCom. In 2002 this telecom company went bankrupt after a major accounting scandal. On the one hand non- existing incomes were reported and on the other hand expenses were capitalized in which was not invested. This unethical behavior could take place because at WorldCom the moral rationalization ‘we are doing this to save the firm’ became ‘we are doing this to save the great economy’. The gap between saving the firm and the entire economy leaves space to more severe unethical actions which resulted in escalation of the behavior (Zyglidopoulos, Fleming

& Rothenberg, 2009).

Moral rationalizations may therefore lead to escalation of immoral behavior. I argue that moral rationalizations moderate the effect of previous immoral behavior on subsequent behavior. Based on this reasoning, the third hypothesis is:

Hypothesis 3: when people initially acted immoral they are more likely to show further immoral behavior, than if people initially acted moral. However, this is even more strongly the case when people make moral rationalizations than when they do not.

The hypotheses are tested in an experiment where the participant will twice make a

choice in an ethical dilemma. The first ethical choice is manipulated. Participants imagine that

they acted either immorally or morally. The second ethical dilemma will be, compared with

the first, either escalating (i.e. the immoral behavior, in which the participants are tempted,

goes beyond the initial behavior) or de-escalating (i.e. the immoral behavior, in which participants are tempted, goes less far than the initial behavior). In between the two choices, moral rationalizations will be manipulated.

METHOD

Participants and Design One hundred seventy-nine persons of 18 years and older voluntary filled out an online

questionnaire. Most of the respondents were acquaintances (relatives, friends or colleagues) of the author. By emailing and personal contact these respondents were asked to fill in the online questionnaire. Other respondents were reached by acquaintances of the author who send the online questionnaire to their contacts. Twenty-one respondents were dismissed, because they did not meet the requirements of the argumentation task. Of the 158 selected respondents was 56.8% male, 43.2% was female, the mean age was 39.76 years and the age range of the participants was 65. The profession of the respondents was divergent. The largest part of the respondents was student (18.4%) or was working in the education sector (20.9%). Participants were randomly assigned to one of the eight conditions of the 2 (previous behavior: moral vs.

immoral) x 2 (escalation: escalation vs. de-escalation) x 2 (moral rationalization: moral rationalization vs. counter-moral rationalization) design experiment.

Procedure

Participants were asked to imagine that they worked in an organization for which they had to proclaim a Chinese business dinner. As the receipt was in Chinese it was hard to decode by the employer. In total four business partners joined the dinner (including the participant). The total costs of the dinner were €40,-. The payment of the bill was spread over these four persons. Each person had to pay an equally part of the bill. Back in Holland, the participants proclaimed the dinner by their boss. The first manipulation of the research was the proclamation behavior of the participants (previous behavior). In the immoral condition the participants proclaimed the whole bill of €40,-. This was in a dishonest way proclaiming more than they actually spent. In the moral condition the participants proclaimed a quarter of the bill, €10,-. This was in an honest way proclaiming what they actually spent.

After this, moral rationalizations were manipulated by an argumentation task.

Participants were asked to write arguments in favor of (moral rationalization condition) or

against (counter moral rationalization condition) proclaiming the whole receipt. It was

explicitly made clear that even when the participant was not able to agree with the given

statement, (s)he should describe arguments why someone else would agree. So, the participants were forced to stick to the assignment.

Next, the respondents had to imagine that they had to proclaim a Jordanian business dinner. The receipt was written in the Arabic language, so like the Chinese receipt also hard to understand for the employer. Only the total amount could be derived from the receipt. This time also a total of four business partners attended the dinner (including the participant). All four partners paid an equal part of the bill. The participants were asked to choose between proclaiming the dinner either in an honest way by proclaiming what they actually spent or in a dishonest way by proclaiming more than they actually spent. The amount of the second proclamation situation was manipulated. In the escalation condition, the bill was significant higher than the previous situation (namely €100). In the de-escalation condition the bill was significant lower than the previous situation (namely €20,-).

Then participants answered a number of questions after which they were thanked.

Measures

Honest declaration behavior

The second proclamation situation (Jordanian dinner) was the dependent variable of this research. This variable is called ‘honest declaration behavior’. Honest declaration behavior was measured on a two-point answering scale (0= dishonest, declaration of the whole bill, 1= honest, declaration of ¼ of the bill).

Checks

Respondents who fulfilled their argumentation task insufficient were dismissed.

Respondents were dismissed when they skipped the argumentation task and did not make any argumentations or when they made argumentations which were not moral rationalizations.

Respondents who made counter moral rationalizations when they were asked to make moral rationalizations or conversely were also dismissed. Twenty-one respondents were dismissed.

These respondents did not empathize well with the situation. As a result this could decrease the accuracy of the results.

The manipulation check of previous behavior was measured by one item on a seven- point answering scale (1= completely disagree, 7= completely agree). The item was: “In the first situation (declaring the Chinese receipt) I proclaimed more than I had spent”.

The manipulation check of escalation was measured by two items on a seven-point

answering scale (1= completely disagree, 7= completely agree). The items started with “In the

second situation (the Jordan receipt) yielded proclaiming the whole receipt me…” and finished with “…more than the first situation (the Chinese receipt)” and “…less than the first situation (the Chinese receipt)”. By recoding the second item, the two items could be combined to one scale. This formed a reliable scale (α=.63).

It was checked to what extent participants could empathize with the assigned previous behavior, this was measured by three items on a seven-point answering scale (1= completely disagree, 7= completely agree). The three items started with “When I read what my decision was concerning the declaration of the Chinese receipt...” and finished with “…I could imagine quite well that I would do so”, “…I could hardly imagine that I would ever do so” and “…it seemed likely that I would do so”. By recoding the item “…I could hardly imagine that I would ever do so”, all three items could be combined to one scale. This formed a reliable scale (α=.89).

RESULTS

Table 1 depicts the correlation coefficients between all variables. First of all we look at

the manipulation checks concerning previous behavior and escalation, to check whether

responses were interpreted as intended. The manipulations of previous behavior and

escalation were successful. There was a significant relationship between previous behavior

and the manipulation check previous behavior, r = .22, p < 0.05. Participants in the immoral

previous behavior condition showed more compliance than participants in the moral previous

behavior condition with the statement that they proclaimed a higher amount of money than

they actually had spent. Escalation was significantly related to the manipulation check

escalation, r = .49, p < 0.05. Participants in the escalating condition agreed to a stronger

extent than participants in the de-escalating condition to the statement that proclaiming the

receipt in the second proclamation situation yielded more than proclaiming the receipt in the

previous behavior situation.

TABLE 1 Correlation Matrix

By using logistic regression honest proclamation behavior was regressed on previous behavior, escalation and moral rationalizations. The main effect of previous behavior on honest proclaiming behavior was significant B = -1.38, p < .005. In the moral previous behavior conditions respondents made more often honest proclamations than in the immoral previous behavior conditions. The main effect of escalation on honest proclaiming behavior was significant B = 1.56, p < .001. So, in the escalating condition people proclaimed more honest than in the de-escalating condition. The main effect of moral rationalizations on honest proclaiming behavior was significant B = -1.15, p < .011. So, people who made counter moral rationalizations behaved more ethically than people who made moral rationalizations.

None of the interaction terms revealed any significant effects. The interaction term

Previous Behavior x Escalation resulted in B = -.77, p <. 54. The interaction term Previous

Behavior x Moral Rationalization resulted in B = -.88, p <.37. The Previous Behavior x

Escalation and Honest Proclamation cross tabulation is depicted in table 2. The Previous

Behavior x Moral Rationalization and Honest Proclamation cross tabulation is depicted in

table 3. From the tables can be derived that relatively few people proclaimed in a dishonest

way. Only 31 participants proclaimed unethical versus 127 participants who proclaimed what

they actually had spent. This could be an explanation for the insignificant outcomes. From

table 2 can be derived that respondents in the moral previous behavior & de-escalation

condition relatively often proclaimed in a dishonest way. From table 3 can be derived that

respondents in the immoral previous behavior & MR condition relatively proclaimed often in

a dishonest way. To test these relationships further an ANOVA will be conducted. By using

ANOVA the dependent variable is considered to be continuous instead of dichotomous.

TABLE 2

Cross Tabulation Previous Behavior x Escalation

TABLE 3

Cross Tabulation Previous Behavior x Moral Rationalization

A 2 (previous behavior: moral vs. immoral) x 2 (escalation: escalation vs. de- escalation) ANOVA with honest proclamation behavior as the dependent variable was conducted. The main effect of previous behavior on honest proclamation behavior was significant, F (1,154) = 8.27, p < .005. People who initially acted immoral showed less honest declaration behavior (M= .73) than people who initially acted moral (M = .90). The main effect of escalation on honest proclaiming behavior was significant, F (1,154) = 11.33, p <

.001. So, in an escalating dilemma people will behave more ethically (M = .90) than in a de- escalating dilemma (M = .69). The interaction term Previous Behavior x Escalation was not significant, F (1,154) = .65, p < .42. Thus, this research could not give any evidence that escalation has an influence on the relationship between previous behavior and honest proclamation behavior.

Then a 2 (previous behavior: moral vs. immoral) x 2 (moral rationalization: moral

rationalization vs. counter-moral rationalization) ANOVA with honest proclamation behavior

as the dependent variable was conducted. The main effect of moral rationalization on honest

proclaiming behavior was significant, F (1,154) = 5.48, p < .02. So, if people make moral

rationalizations they will behave less ethically (M= .72) than if they make counter moral rationalizations (M= .87). The Previous Behavior x Moral Rationalization interaction was marginal significant, F (1,154) = 2.85, p < .09. In the moral rationalization condition, participants significantly proclaim less moral when they previously acted immorally (M = .59, SD = .50) than when they previously acted morally (M = .88, SD = .33) (pairwise comparison p < .002). In the counter moral rationalization condition, participants did not significantly proclaim less moral when they previously acted immorally (M = .84, SD = .37) than when they previously acted morally (M = .92, SD = .28) (pairwise comparison p < .324). Thus as depicted in figure 1, the tendency to proclaim more immoral is probably a function of Moral Rationalizations and Previous Behavior.

FIGURE 1

Honest Proclamation Behavior, Proclaiming the Whole or ¼ Receipt, as a Function of Moral Rationalization and Previous Behavior

The variable ‘commitment state' was used to measure to what extent the participants

could empathize with the assigned previous behavior. A relative small part of the respondents

could empathize with the assigned previous behavior. The mean of the variable ‘commitment

state’ was low (M= 3.48, SD= 1.87). This low mean indicates that people encountered

problems with empathizing with the assigned previous behavior. Respondents who scored a 5

or higher on the seven-point answering scale showed that they could empathize with the

assigned previous behavior. Of the total population was 79.10% cut off the distribution. This

part of the respondents scored lower than five on the seven-point answering scale and encountered problems with empathizing with the assigned previous behavior. Respondents who could empathize with the assigned previous behavior (respondents who scored a five or higher) yielded 20.90% of the total population (z = .81). The low mean and the small part of the respondents that could empathize with the assigned previous behavior can result in a decrease of the accuracy of the results.

DISCUSSION

This research intended to test whether, how and under what conditions unethical organizational behaviors may escalate. This was tested with a survey. Next the hypotheses of this study will be discussed.

Hypothesis 1: when people initially acted immoral they are more likely to show further immoral behavior, than if people initially acted moral.

The results showed that people who initially acted unethical tend to act more immoral in the future. And people who initially acted moral tend to show more honest subsequent behavior. So, once people crossed the border of immoral behavior they will continue this unethical behavior. The results suggested that people escalate in the sense that they continue their behavior. Previous literature has shown that people tend to stay committed to their (un)ethical decision because of the irrational idea that time, money or effort will be wasted if someone does not stay committed to the previous decision (Arkes & Blumer, 1985). It was also stated that instead of escalation of immoral behavior, compensation for immoral behavior might occur (Bandura, Barbaranelli, Caprara & Pastorelli, 1996; Sachdeva, Iliev & Medin, 2009). Compensatory behavior literature suggested that people take the ethicality of previous decisions in consideration. If the previous behavior was unethical and harmed the self-worth, the next behavior will be ethical to compensate for the loss of self-worth (Sachdeva, Iliev &

Medin, 2009; Zhong, Ku, Lount, & Murninghan, 2010). However, the current research

indicates the opposite. After acting immoral, people will still act immoral and will not

compensate for this behavior. Sachdeva, Iliev and Medin (2009) manipulated self-worth in

their research methodology by asking respondents to either describe a situation from their

own perspective or from the perspective of others. In their research methodology Zhong, Ku,

Lount, and Murninghan (2010) made use of single decisions in time by sending respondents

different decision situations over time. Both concepts ‘self-worth’ and ‘time to think over decisions’ resulted in compensation behavior. The method used by Martens, Kosloff and Jackson (2010) and the method of the current research was short-term focussed. Respondents did not explicitly have time to think about their decisions. No explicit distinction was made between respondents that made the decision from their own perspective or from someone else’s perspective. Thus, research suggests that people who have time to think over their decision tend to compensate for their behaviour and balance their self-worth (Sachdeva, Iliev

& Medin, 2009; Zhong, Ku, Lount, & Murninghan, 2010). If people do not have time to think over their decision they tend to stay committed to their previous decision (Martens, Kosloff and Jackson, 2010).

Hypothesis 2: when people initially acted immoral they are more likely to show further immoral behavior, than if people initially acted moral. This is less true if the second situation is more serious the initial situation than if the second situation is less serious than the first situation.

This study did not find a moderating role for escalatory situation on the relationship between previous behavior and further immoral behavior. The results suggested that people who initially acted immoral tend to continue this behavior. The lack of interaction with escalation shows that it does not matter if the subsequent behavior goes further than the previous behavior. People do not mind whether the subsequent behavior is more immoral or not. So, escalation occurs easily. Literature suggested that insensitivity for ethicality and incremental steps hide the moral components of a decision. This makes it easier to show further immoral behavior (Gino & Bazerman, 2009; Tenbrunsel & Messick, 2004; Tsang, 2002; Zyglidopoulos, Fleming & Rothenberg, 2009). A theoretical implication of this research is that escalation occurs easily and that people are relatively insensitive for the difference in subsequent behavior in escalation of immoral behavior. The slippery slope mechanism ‘psychic numbing’ might be more relevant in escalation of immoral behavior than the ‘induction mechanism’.

Hypothesis 3: when people initially acted immoral they are more likely to show further

immoral behavior, than if people initially acted moral. However, this is even more

strongly the case when people make moral rationalizations than when they do not.

Previously it has been suggested that moral rationalizations lead to escalation of immoral behavior (Zyglidopoulos, Fleming & Rothenberg, 2009), but the relationship between moral rationalizations and escalation was never empirically demonstrated. This is the first research that does. This research suggests that moral rationalizations moderate the effect of previous behavior on subsequent behavior. When people made moral rationalizations, previous immoral behavior instigated further immoral behavior. When people made counter moral rationalizations, previous behavior did not instigate further immoral behavior. A strength of this research is that moral rationalizations were manipulated. Up to now moral rationalizations have only been measured as a personality measure so that only non-causal relationships were drawn between moral rationalizations and immoral behavior. It was not known whether moral rationalizations caused immoral behavior or else that people who scored high on moral rationalizations are immoral people. So, the current research suggests that it is the act of making moral rationalization that contributes to the escalation of immoral behavior. However, some caution is necessary as the moderating effect of moral rationalizations on the relationship between previous behavior and proclamation behavior was marginal significant. So, it would be interesting that future research could provide evidence for the influence of moral rationalizations on unethical behavior.

Strengths and Weaknesses

The strength of this research is the large background diversity of the respondents. A large part of the respondents is working in the education sector but also a lot of other sectors were covered with the questionnaire, for example the governmental sector and the healthcare sector. This makes the outcomes of the research more generalizable.

Nevertheless, it is possible that people gave socially desirable answers because they were still afraid (despite the assurance of anonymity) that the survey was not anonymous.

This may have led to an overestimation of people who acted morally. Indeed, only few respondents proclaimed unethical so that no adequate tests could be conducted because the power of immoral proclamations was too small. For more significant results future research should either make use of a continuous dependent variable, equal distribution in the dependent variable or more respondents.

Practical Implications

As stated above fraud is considered as a criminal offence but that people that commit

fraud often appear to be “ordinary people” (Anand, Ashforth, & Joshi, 2004). The results of

this paper suggest that once people crossed the border of immoral behavior they will continue this unethical behavior. This is more strongly the case when people use moral rationalizations for their previous immoral acts. Therefore, it is important that making moral rationalizations is avoided.

Anand, Ashforth, & Joshi (2004), suggested some interventions for the prevention of rationalizations. Awareness of the inaccuracy of rationalizations that justify immoral behavior reduces the probability of showing unethical behavior. Employee training to periodically think about a decision from different perspectives might help to see beyond the norms and believes. Through this people will be aware of their unethical behavior and people will not unconsciously justify their behavior. Another way of preventing the onset of making rationalizations is an evaluation approach that not only measures whether employee performance was achieved but also how this performance was achieved. Individuals will not only be rewarded for their performance but also for the ethically of the process to reach this performance. For example, if people acted immoral they will not receive a bonus (Anand, Ashforth, & Joshi, 2004).

An alternative implication is only selecting people who make little or none moral rationalizations. In the selection procedure the moral disengagement scale of Hymel, Rocke- Henderson and Bonanno (2005) can be used. People will be selected on the basis of this scale.

By this moral disengagement scale people have to indicate on a four-point answering scale to what extent they agree or disagree with a given statement. The different statements assess beliefs and attitudes about bullying. All the items of the scale identify moral disengagement.

Conclusions

In the current study, the question was raised whether, how and under what conditions

unethical organizational behaviors may escalate. It was found that people stay committed to

their initial behavior. People, who initially acted moral, continue to act moral in the future and

people who initially acted immoral continue to act immoral in the future. Once people have

been immoral, escalation of immoral behavior occurs either if the subsequent behavior goes a

step further or not. This suggests that escalation of immoral behavior occurs easily. It was also

found that moral rationalizations instigate further immoral behavior. So, moral

rationalizations are not only related to immoral behavior but they actually cause continuation

of it. With this study I aim at inspiring future research on whether, how and under what

conditions unethical organizational behaviors may escalate.

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