Let’s explore some of the most interesting stories that have emerged from New York City business schools this week.
Columbia Business School: Mandated Corporate Good Behavior Hurts Bottom Line & Reduces Efforts to “Do Good” – CBS Newsroom
New research from Columbia Business School professor Shivaram Rajgopal finds that mandatory Corporate Social Responsibility as a business practice is a “value-decreasing proposition for shareholders, and a disincentive for corporate good behavior.”
Raigopal writes, “Our findings prove that CSR is counterproductive when governments get involved. In developing an effective method for measuring CSR’s impact on business we were able to prove that CSR only has value if it is a voluntary activity. Shareholder value decreases as mandatory CSR increases. In fact, mandatory CSR is, in effect, nothing more than an inefficient backdoor tax on private sector.”
You can read more about Raigopal’s research here.
Introduction of Craigslist Increased Prostitution Across U.S. – Experience Stern
New research from NYU Stern School of Business and the University of Minnesota’s Carlson School of Management finds that “as Craigslist expanded across the United States, the free classifieds website also bolstered the sex industry,” which co-author Anindya Ghose, the Heinz Riehl Professor of Business at the Stern School, explains is “made up of both independent sex workers and workers operating under commercial vice groups.” In fact, Craigslist’s entry into a county increased prostitution cases—both “transactions by existing sex workers, as well as prompted recruitment and coercion of new ones”—by 17.58 percent.
The data was revealed in the recently-released study “The Digital Sin City: An Empirical Study of Craigslist’s Impact on Prostitution Trends”, which was “based on analysis of national panel data for 1,796 U.S. counties from 1999 to 2008.”
You can read more about the study here.
Lonely and Non-Empathetic People More Likely to Make Unethical Shopping Decisions – Binghamton SOM
New research from Binghamton SOM assistant professor of marketing Jenny Jiao finds that lonely consumers “very often behave immorally. And while these behaviors are often legal, they are unethical and cost retailers billions each year.”
She cites the common example of ‘wardrobing’ in which “someone may buy a big-screen TV for Super Bowl Sunday, only to return it on Monday; or they may buy a nice outfit for a night out, only to return it the next day.”
In Jiao’s paper, “Can Lonely People Behave Morally? The Joint Influence of Loneliness and Empathy on Moral Identity,” which was recently published in the Journal of Consumer Psychology, she was interested in how much of a factor loneliness played in this type of consumer behavior.
“We found that lonely people are capable of empathizing and making moral decisions, but they may not have the intention or motivation to. But when empathy levels increase, we don’t see much difference between lonely people and non-lonely people. Lonely people will be more likely to engage in moral behaviors and less likely to engage in immoral behaviors when they feel empathy.”
Read more about Jiao’s research here.