It is time to transcend the arid debate between rationality and ir-, a-, or non-rationality as our basic assumption about human agency.1 There are powerful arguments and extensive evidence both for and against the rationality assumption, with heavily defended entrenchments on both sides. Managers and management scholars continually make at least tacit assumptions about how they expect others to behave. If only we could have in both theory and practice the coherence and precision of rational models as well as the (...) descriptive richness of ‘behavioural’ approaches. The message of this paper is that perhaps we can. The advent of consciousness studies and, more recently, neuroeconomics would seem to indicate the way forward to transcend the opposition in some kind of synthesis. This paper investigates rationality in the light of Daniel Dennett’s thesis that it is at the core of all intentionality that is the defining characteristic of mental phenomena. Neuroeconomics seeks to enhance understanding of agency by investigating new insights on the materialist basis of mental phenomenology in the neurophysiology of the brain and nervous system. Experimental evidence mapping intentional states onto neurophysiological states is emerging, some researchers even claiming to have found a ‘neurophysiological utility function’. Dennett closes the circuit by locating the existence of brain-hardware supporting satisficing intentional choice and action as the output of evolutionary ‘design’. The dichotomy is transcended: satisficing models (of which normative optimising rational choice models are a reasonable abstraction) are a good basis both for statistical prediction of the behaviour of large numbers, and as the first base on which to construct and refine a model of expectation-formation about particular types of agent and then of individual agents. Using both the old (‘external’) and the new (sub-individual) behaviourism as well as work on unpacking the abstract notion of rationality, we can concretise optimising rational choice both generally, for epistemic theory-building purposes, and specifically for understanding and deploying models of managerial agency. Such models will need to incorporate emotion with cognition in an integrated approach. (shrink)

Current theories of management have difficulty overcoming certain problems and limitations related to some features of the field itself multiplicity, midtidisciplinarityt fragmentation, presence or lack of paradigms, se/freferentiality, and ethnocentrism. This paper first reviews these issues broadly. Then, it emphasises the preponderance of the scientific method and the exclusion of philosophy as theoretical foundations for management. It proposes taking philosophy as the science to provide the foundations of management. It explains how philosophy — especially philosophy that has its roots in (...) Aristotelian thought - can be of help to management through four different functions: admirative, globalising, political, and critical. In this way, Aristotelian philosophy is shown to be a superior basis for solving the present problems in management theory and a fruitful option for integrating ethics in organisational and management theories. (shrink)

Trends in corporate governance to minimize employee participation and to promote shareholder rights, in both the EU and US contexts, evidence the practical efficacy of the separation thesis and the dominance of models of corporate governance founded upon decision theory. Giving expression to a vision of human agency in terms of instrumental rationality, such models of corporate governance, presuppose clearly defined objectives. Drawing on the work of Talbot Brewer, Alasdair MacIntyre, and Robert Brandom, this paper offers an alternative practice-based model (...) of corporate governance that emphasizes the role of socially and historically embodied forms of reasoning in promoting a better understanding of the aims or objectives of the corporation, particularly with respect to the social, environmental, and economic context of the firm. After reviewing recent empirical literature concerning employee participation, criteria are offered concerning effective employee participation programs, as a means of implementing a practice-based model of corporate governance. (shrink)

It is my view that one essential difference between persons and other creatures is to be found in the structure of a person's will. Besides wanting and choosing and being moved to do this or that, men may also want to have certain desires and motives. They are capable of wanting to be different, in their preferences and purposes, from what they are. Many animals appear to have the capacity for what I shall call "first-order desires" or "desires of the (...) first order," which are simply desires to do or not to do one thing or another. No animal other than man, however, appears to have the capacity for reflective self-evaluation that is manifested in the formation of second-order desires. (shrink)

Our brains were designed for tribal life, for getting along with a select group of others and for fighting off everyone else. But modern times have forced the world’s tribes into a shared space, resulting in epic clashes of values along with unprecedented opportunities. As the world shrinks, the moral lines that divide us become more salient and more puzzling. We fight over everything from tax codes to gay marriage to global warming, and we wonder where, if at all, we (...) can find our common ground. (shrink)

A collection of some of Sellars' lectures and articles from 1951 to 1962.

Modelling agency in economics rests primarily on the assumption of instrumental rationality. Managerial agency is more often analysed with a more complex ‘behavioural’ approach. This has led for years to a sterile debate about the usefulness of the abstract rationality postulate between those who think that it is all but sufficient and those who doubt if it is even necessary. This paper argues that positing an abstract (but real) rational core to managerial agency that is then ‘concretised’ towards actual managerial (...) behaviour is the way forward. Rationality is a necessary but not sufficient characterisation of managerial agency. The theoretical argument is supported by reference to the case of the ill-fated Long Term Capital Management built around the Black, Merton and Scholes Nobel Prize-winning derivatives pricing model. It is argued that the 1998 failure of the portfolio was not the result of a failure of rational agency but of the complexities of its implementation. (shrink)

"Friendship", for Aristotle, is a term with "focal meaning" which denominates relationships as casual as fellow travelers on a voyage, as permanent as spouses, and whose motives are as various as the commercial, military, religious, sexual, political and the virtuous. What can be said of all these relationships is that they involve a solidarity, a concordat, a reciprocity, which has its foundation in a common field between the parties and which produces common actions or exchanges. All friendships tend to equality (...) in the sense that they do not insist on what is due as an ultimate end; friendship, like equity, surpasses justice in the fulfillment of what is owed. Because friendship fosters solidarity and justice it is politically important as a virtue-context, according to Aristotle. Is it possible that friendship can function as a virtue-context within economic life as well? Aristotle's notion of a type of useful friendship which functions through expectation of moral behavior will be shown to provide both motive and context for the performance of acts of virtue in a business setting. (shrink)

In this paper, I explore the nature of strategic decision making. In particular, I am concerned with the interplay of rational reflection and intuitive insight in strategic contexts. I argue that it is in the very nature of strategic situations that they cannot be exhaustively analysed in terms of the available evidence, and that hence there always is an intuitive element to strategic decision making. I consider a variety of ways to explain the notion of intuition and conclude that intuition (...) and rationality ought not to be conceived as incompatible with one another. It follows, I claim, that the intuitive component of strategic thought allows for at least some degree of public accountability. (shrink)

Sumantra Ghoshal’s condemnation of “bad management theories” that were “destroying good management practices” has not lost any of its salience, after a decade. Management theories anchored in agency theory (and neo-classical economics generally) continue to abet the financialization of society and undermine the functioning of business. An alternative approach (drawn from a more classic institutional, new ecological, and refocused ethical approaches) is reviewed.

In this article I maintain the importance of the Aristotelian concept of prudence or phronesis applied to business ethics, distinguishing its meaning from Solomon and Hartman’s approaches to Aristotelian business ethics. Whereas Solomon stresses the value of perception of particulars and Hartman criticizes the incapacity of Aristotelian phronesis to dwell with the interests of others, I advocate that Aristotelian virtue ethics is important because the concept of phronesis does three things: (a) stresses the rational calculation and general principles or rules (...) in virtue ethics, in general, and business ethics, in particular; (b) provides a communal-based ethics principle; and c) offers us a clear comprehension about what calculation or reasoning is in ethics. (shrink)

The current economic and preceding financial crises seem to provide evidence in favour of the self-destruction thesis of capitalism. Responses to the crisis have been polarised. Some suggest that regulatory changes are all that is needed. Others suggest the need to change the economic system by developing a new global economic ethic. The first is too limited, the second too utopian. This article suggests that a MacIntyrean virtue ethics approach provides both a more convincing diagnosis of the problem and leads (...) to a more workable prescription. First, we need to understand the internal contradictions of the tradition that has developed of how to ‘do’ business. Then we need the virtues to be exercised inside practices and institutions. But virtue itself needs to be institutionalised; we need an appropriate governance of virtue in organizations. Even though governance is usually taken to ‘crowd out’ virtue, this article proposes an approach to governance that ‘crowds in’ virtue. (shrink)

The virtue approach to business ethics is a topic of increasing importance within the business world. Focusing on Aristotle's theory that the virtues of character, rather than actions, are central to ethics, Edwin M. Hartman introduces readers of this book to the value of applying Aristotle's virtue approach to business. Using numerous real-world examples, he argues that business leaders have good reason to take character seriously when explaining and evaluating individuals in organisations. He demonstrates how the virtue approach can deepen (...) our understanding of business ethics, and how it can contribute to contemporary discussions of character, rationality, corporate culture, ethics education and global ethics. Written by one of the foremost Aristotelian scholars working in the field today, this authoritative introduction to the role of virtue ethics in business is a valuable primer for graduate students and academic researchers in business ethics, applied ethics and philosophy. (shrink)

This paper argues that economics, over the past 200 years, has become steadily more anti-philosophical and that there are three stages in the development of economic thought. Adam Smith intended economics to be a descriptive social science, rooted in an understanding of the moral and psychological processes of an individual’s decision-making and its connection to society in general. Yet, immediately after Smith’s death, economists made a clean cut and invented a totally new discipline: they switched towards a physicalist understanding of (...) human nature. Humans, like atoms, follow a natural law: they are driven by an emotion (defined as a non-emotion, rationality), namely selfishness. Thus economics became a ‘natural’ science. In the 20th century, the second reinterpretation removed all traces of humanity from the study of economics and declared economics to be a formal science like mathematics and logics. The actor in Phase 3 economics is homo economicus syntheticus, a postulate whose only connection to real humanity is the word homo. The paper asks what the results of this dramatic relocation are and why Phase 3 economics still claims descent from Smithian economics, despite the massive differences. (shrink)

Abstract:A complex organization is in effect a commons, which supervisory techniques cannot preserve from free riding. A corporate culture strong enough to create the requisite community-minded second-order desires and beliefs may be morally illegitimate. What morality requires is not local enforcement of foundational moral principles—a futile undertaking—but that the organization be a good community in that it permits the disaffected to exit, encourages reflective consideration of morality and the good life, and creates appropriate loyalty.

Research on moral judgment has been dominated by rationalist models, in which moral judgment is thought to be caused by moral reasoning. The author gives 4 reasons for considering the hypothesis that moral reasoning does not cause moral judgment; rather, moral reasoning is usually a post hoc construction, generated after a judgment has been reached. The social intuitionist model is presented as an alternative to rationalist models. The model is a social model in that it deemphasizes the private reasoning done (...) by individuals and emphasizes instead the importance of social and cultural influences. The model is an intuitionist model in that it states that moral judgment is generally the result of quick, automatic evaluations (intuitions). The model is more consistent than rationalist models with recent findings in social, cultural, evolutionary, and biological psychology, as well as in anthropology and primatology. (shrink)

Technological advancements in information systems over the past few decades have enabled firms to work with the major suppliers and customers in their supply chain in order to improve the performance of the entire channel. Tremendous benefits for all parties can be realized by sharing information and coordinating operations to reduce inventory requirements, improve quality, and increase customer satisfaction; but the companies must collaborate effectively to bring these gains to fruition. We consider two alternative methods of managing these interfirm supply (...) chain relationships in this article. The first, which we have named “dictatorial collaboration,” occurs when a dominant supply chain entity assumes control of the channel and forces the other firms to follow its edicts. We compare and contrast this method with “sustainable collaboration,” in which the parties share resources and engage in joint problem solving to improve the performance of the system as a whole. We use a virtue ethics lens to describe these methods of relationship management to suggest that sustainable collaboration is preferable to dictatorial collaboration both operationally and ethically in the long run. (shrink)

In this urbane and witty book, Ronald de Sousa disputes the widespread notion that reason and emotion are natural antagonists.

This book is a provocative contribution to contemporary ethical theory challenging foundational conceptions of character that date back to Aristotle. John Doris draws on behavioral science, especially social psychology, to argue that we misattribute the causes of behavior to personality traits and other fixed aspects of character rather than to the situational context. More often than not it is the situation not the nature of the personality that really counts. The author elaborates the philosophical consequences of this research for a (...) whole array of ethical theories and shows that, once rid of the misleading conception of motivation, moral psychology can support more robust ethical theories and more humane ethical practices. (shrink)