Ethics | Academic Articles
Carr, A. Is bluffing ethical? Harvard Business Review, 1968, Jan.
- The basis of private morality is a respect for truth and that the closer a
businessman comes to the truth, the more he deserves respect.
- Most bluffing in business might be regarded as a game strategy - much like bluffing
in poker, which does not reflect on the morality of the bluffer.
- An exact description of bluffing in poker, diplomacy, and business: "falsehood
ceases to be falsehood when it is understood on all sides that the truth is not
expected to be spoken."
- The ethical standards of the business game are far cry from those of the private life.
- Most executives use conscious misstatements, concealment of pertinent facts, or
exaggeration - in short, use bluffing - to persuade others to agree with them.
- If the individual executive refuses to bluff from time to time - if he feels obligated
to tell the truth, the whole truth, and nothing but the truth - he is ignoring
opportunities permitted under the rules and is at a heavy disadvantage in his
business dealings.
- The game is played at all levels of corporate life, from the highest to the lowest. At
the very instant that one decides to enter business, he/she may be forced into a
game situation.
- We can learn a good deal about the nature of business by comparing it with poker.
Both have a large element of chance, in the long run the winner is the man who
plays with steady skill. In both games victory requires intimate knowledge of the
rules, insight into the psychology of the other players, a bold front, a considerable
amount of self-discipline, and the ability to respond swiftly and effectively to
opportunities provided by chance.
- Poker's own brand of ethics varies from the ethical ideals of human relationships.
Poker calls for distrust of the other fellow. It ignores the claim of friendship.
Deception and concealment of one's strength and intentions are vital in poker.
- Most businessmen are not indifferent to ethics in their private lives. In their office
lives they cease to be private citizens; they become game players who must be
guided by a different set of ethical standards.
Page 1 of 21
,- The respect for the golden rule is a confession of defeat. Believing that the golden
rule, for all its value as an ideal for society - people should aim to treat each other
as they would like to be treated themselves - is not feasible as a guide for business.
- Violations of the ethical ideals of society are common in business, but they are not
necessarily violations of business principles.
- The illusion that business can afford to be guided by ethics as conceived in private
life is often fostered by speeches and articles containing such phrases as, "it pays to
be ethical" or "sound ethics is good business". Actually this is not an ethical position
at all. The basic business rules have been set by the government, which attempts to
detect and punish business frauds. As long as the company does not transgress the
rules of the game set by law, it has the legal right to shape its strategy without
reference to anything but its profits. Decisions in this areas are decisions of strategy,
not of ethics.
- All sensible businessmen prefer to be truthful, but they seldom feel inclined to tell
the whole truth. In the business game truth-telling usually has to be kept within
narrow limits if trouble is to be avoided.
- To be a winner, a man must play to win. Every businessman, like every poker
player, is offered a choice between certain loss or bluffing within the legal rules of
the game. If he is not resigned to losing, if he wants to rise in his company and
industry, then in such a crisis he will bluff.
- In all, bluffing in business is analogous to bluffing in poker and therefore should
not be thought to be impermissible insofar as it is part of the way that the game is
played.
Allhoff, F., Business bluffing reconsidered, Journal of Business Ethics, 2003.
- The goal of bluffing is to enhance the strength of one's position during negotiations.
- Bluffing seems to bear a strong resemblance to lying, and therefore might be
thought to be impermissible. However, many people have the intuition that bluffing
is an appropriate and morally permissible negotiation tactic.
- Thomas Carson argued that since business negotiations instantiate a context
wherein claims are not warranted to be true, bluffing is not lying. Bluffing is
certainly lying on the traditional definition; the bluffer’s statement is false and it is
intended to deceive. But Carson thinks that his definition of lying excludes bluffing.
Page 2 of 21
, Why? He argues that the second requirement, the warrantability of truth, is largely
absent in negotiations.
- Albert Carr argued that business is a game, just like poker, and that bluffing is
permitted under the rules of the game.
- According to Allhoff, both authors appeal to games in order to argue for the
permissibility of bluffing in business; Carr uses a poker analogy and Carson argues
that claims made during bluffing are similar to claims made during the game of
Risk. But the problem is that both authors infer moral legitimacy from the rules of
their games, and this inference cannot be made. Instead, a moral argument is
necessary that legitimizes bluffing within those games and that can be extended to
bluffing in business.
- Role-differentiated morality (i.e. ethical rules bound to professional work)
suggests the following:
1. Certain roles make acts permissible that would otherwise be impermissible. For
instance, soldiers fighting a just war are morally permitted to kill, whereas ordinary
civilians are not.
2. Certain roles make acts impermissible that would otherwise be permissible. For
example, college professors should not have sexual relationships with their students
(nor bosses with their subordinates), regardless of the act being consensual.
3. Certain roles make acts obligatory that would otherwise not be obligatory. For
instance, parents have special obligations to their children, such as providing for
them and caring for them, that non-parents would not have towards the same
child.
- Allhoff believes that bluffing in business is permissible for the same reason that it is
permissible in games, namely that the participants endorse the practice. Without
bluffing, the idea of negotiations itself almost becomes incoherent. For instance, to
reach a transaction price, it makes the most sense for the buyer to start low and the
seller high, and to reach some agreement in the middle.
- Business negotiation is a game. Perhaps this is not true in the sense that negotiators
are drawn to their work as they find it amusing, this is false in a wide number of
cases. However, if two parties come to the negotiating table and the reservation
price of the buyer is higher than the reservation price of the seller, then we already
know that, the transaction will occur (at a price to which both parties agree). The
satisfaction of the parties is what is really important. Whether the stakes are
millions of dollars or not, the parties are still merely trying to secure money that
they would otherwise be satisfied without.
Page 3 of 21
Carr, A. Is bluffing ethical? Harvard Business Review, 1968, Jan.
- The basis of private morality is a respect for truth and that the closer a
businessman comes to the truth, the more he deserves respect.
- Most bluffing in business might be regarded as a game strategy - much like bluffing
in poker, which does not reflect on the morality of the bluffer.
- An exact description of bluffing in poker, diplomacy, and business: "falsehood
ceases to be falsehood when it is understood on all sides that the truth is not
expected to be spoken."
- The ethical standards of the business game are far cry from those of the private life.
- Most executives use conscious misstatements, concealment of pertinent facts, or
exaggeration - in short, use bluffing - to persuade others to agree with them.
- If the individual executive refuses to bluff from time to time - if he feels obligated
to tell the truth, the whole truth, and nothing but the truth - he is ignoring
opportunities permitted under the rules and is at a heavy disadvantage in his
business dealings.
- The game is played at all levels of corporate life, from the highest to the lowest. At
the very instant that one decides to enter business, he/she may be forced into a
game situation.
- We can learn a good deal about the nature of business by comparing it with poker.
Both have a large element of chance, in the long run the winner is the man who
plays with steady skill. In both games victory requires intimate knowledge of the
rules, insight into the psychology of the other players, a bold front, a considerable
amount of self-discipline, and the ability to respond swiftly and effectively to
opportunities provided by chance.
- Poker's own brand of ethics varies from the ethical ideals of human relationships.
Poker calls for distrust of the other fellow. It ignores the claim of friendship.
Deception and concealment of one's strength and intentions are vital in poker.
- Most businessmen are not indifferent to ethics in their private lives. In their office
lives they cease to be private citizens; they become game players who must be
guided by a different set of ethical standards.
Page 1 of 21
,- The respect for the golden rule is a confession of defeat. Believing that the golden
rule, for all its value as an ideal for society - people should aim to treat each other
as they would like to be treated themselves - is not feasible as a guide for business.
- Violations of the ethical ideals of society are common in business, but they are not
necessarily violations of business principles.
- The illusion that business can afford to be guided by ethics as conceived in private
life is often fostered by speeches and articles containing such phrases as, "it pays to
be ethical" or "sound ethics is good business". Actually this is not an ethical position
at all. The basic business rules have been set by the government, which attempts to
detect and punish business frauds. As long as the company does not transgress the
rules of the game set by law, it has the legal right to shape its strategy without
reference to anything but its profits. Decisions in this areas are decisions of strategy,
not of ethics.
- All sensible businessmen prefer to be truthful, but they seldom feel inclined to tell
the whole truth. In the business game truth-telling usually has to be kept within
narrow limits if trouble is to be avoided.
- To be a winner, a man must play to win. Every businessman, like every poker
player, is offered a choice between certain loss or bluffing within the legal rules of
the game. If he is not resigned to losing, if he wants to rise in his company and
industry, then in such a crisis he will bluff.
- In all, bluffing in business is analogous to bluffing in poker and therefore should
not be thought to be impermissible insofar as it is part of the way that the game is
played.
Allhoff, F., Business bluffing reconsidered, Journal of Business Ethics, 2003.
- The goal of bluffing is to enhance the strength of one's position during negotiations.
- Bluffing seems to bear a strong resemblance to lying, and therefore might be
thought to be impermissible. However, many people have the intuition that bluffing
is an appropriate and morally permissible negotiation tactic.
- Thomas Carson argued that since business negotiations instantiate a context
wherein claims are not warranted to be true, bluffing is not lying. Bluffing is
certainly lying on the traditional definition; the bluffer’s statement is false and it is
intended to deceive. But Carson thinks that his definition of lying excludes bluffing.
Page 2 of 21
, Why? He argues that the second requirement, the warrantability of truth, is largely
absent in negotiations.
- Albert Carr argued that business is a game, just like poker, and that bluffing is
permitted under the rules of the game.
- According to Allhoff, both authors appeal to games in order to argue for the
permissibility of bluffing in business; Carr uses a poker analogy and Carson argues
that claims made during bluffing are similar to claims made during the game of
Risk. But the problem is that both authors infer moral legitimacy from the rules of
their games, and this inference cannot be made. Instead, a moral argument is
necessary that legitimizes bluffing within those games and that can be extended to
bluffing in business.
- Role-differentiated morality (i.e. ethical rules bound to professional work)
suggests the following:
1. Certain roles make acts permissible that would otherwise be impermissible. For
instance, soldiers fighting a just war are morally permitted to kill, whereas ordinary
civilians are not.
2. Certain roles make acts impermissible that would otherwise be permissible. For
example, college professors should not have sexual relationships with their students
(nor bosses with their subordinates), regardless of the act being consensual.
3. Certain roles make acts obligatory that would otherwise not be obligatory. For
instance, parents have special obligations to their children, such as providing for
them and caring for them, that non-parents would not have towards the same
child.
- Allhoff believes that bluffing in business is permissible for the same reason that it is
permissible in games, namely that the participants endorse the practice. Without
bluffing, the idea of negotiations itself almost becomes incoherent. For instance, to
reach a transaction price, it makes the most sense for the buyer to start low and the
seller high, and to reach some agreement in the middle.
- Business negotiation is a game. Perhaps this is not true in the sense that negotiators
are drawn to their work as they find it amusing, this is false in a wide number of
cases. However, if two parties come to the negotiating table and the reservation
price of the buyer is higher than the reservation price of the seller, then we already
know that, the transaction will occur (at a price to which both parties agree). The
satisfaction of the parties is what is really important. Whether the stakes are
millions of dollars or not, the parties are still merely trying to secure money that
they would otherwise be satisfied without.
Page 3 of 21
