the love of money is the root of all evil: pay satisfaction and cpi as moderators paper presented at...
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The Love of Money is the Root of All Evil:
Pay Satisfaction and CPI as Moderators
Paper Presented at
Academy of Management San Antonio, TX, August 12-16, 2011
Thomas Li-Ping Tang, Ph.D.
And Members of the Cross-Cultural Research Team
Best Paper Proceedings of AoM 2011 (online program)
Toto Sutarso, Middle Tennessee State University, U.S.A.,Mahfooz A. Ansari, University of Lethbridge, Canada, Vivien Kim Geok Lim, National University of Singapore, Singapore,Thompson Sian Hin Teo, National University of Singapore, Singapore,Fernando Arias-Galicia, Universidad Autónoma del Estado de Morelos,
Mexico,
Ilya Garber, Saratov State University, Russia,Peter Vlerick, Ghent University, Belgium, Jian Liang, Shanghai Jiao Tong University, China,Adebowale Akande, International Institute of Research, South Africa,Michael W. Allen, University of Sydney, Australia,Abdulgawi Salim Alzubaidi, Sultan Qaboos University, Oman,Mark G. Borg, University of Malta, Malta,Brigitte Charles-Pauvers, University of Nantes, France,Bor-Shiuan Cheng, National Taiwan University, Taiwan,Randy K. Chiu, Hong Kong Baptist University, Hong Kong, Linzhi Du, Nankai University, China,Consuelo Garcia De La Torre, Technological Institute of Monterrey,
Mexico,Rosario Correia Higgs, Polytechnic Institute of Lisbon – Portugal, Portugal, Abdul Hamid Safwat Ibrahim, Iman University, Saudi Arabia, Chin-Kang Jen, National Sun-Yat-Sen University, Taiwan,Ali Mahdi Kazem, Sultan Qaboos University, Oman,Kilsun Kim, Sogang University, South Korea,
Roberto Luna-Arocas, University of Valencia, Spain,Eva Malovics, University of Szeged, Hungary, Alice S. Moreira, Federal University of Pará, Brazil, Richard T. Mpoyi, Middle Tennessee State University, the U.S.A., Anthony Ugochukwu Obiajulu Nnedum, Nnamdi Azikiwe University, Nigeria, Johnsto E. Osagie, Florida A & M University, U.S.A.,AAhad M. Osman-Gani, Nanyang Technological University, Singapore,Francisco Costa Pereira, Polytechnic Institute of Lisbon – Portugal, Portugal,Ruja Pholsward, Rangsit University, Thailand, Horia D. Pitariu, Babes-Bolyai University, Romania,Marko Polic, University of Ljubljana, Slovenia,Elisaveta Sardzoska, University St. Cyril and Methodius, Macedonia, Petar Skobic, Middle Tennessee State University, U.S.A.Allen F. Stembridge, Andrews University, U.S.A.,Theresa Li-Na Tang, Affinion Group, Brentwood, TN, U.S.A., Marco Tombolani, University of Padua, Italy,Martina Trontelj, University of Ljubljana, Slovenia,Caroline Urbain, University of Nantes, France,Luigina Canova, University of Padua, Italy,Anna Maria Manganelli, University of Padua, Italy
Recognize
Members of the Research Team Who Attend the AoM 2011, Please Stand Up
Best Paper Proceedings of AoM 2011 (Leslie A. Toombs (Ed.))
Corruption the illicit use of one’s position or
power for perceived personal or collective gain
both a state and a process that reflects not only the corrupt behavior of an individual but also the dangerous, viruslike infection of a group, organization, industry, country (Ashforth, Gioia, Robinson, & Treviño, 2008; Tepper, Carr, Breaux, Geider, Hu, & Hua, 2009).
Proposition: The Love of Money is the Root of All Evil
“People who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge men into ruin and destruction. For the love of money is the root of all evil”.
(1 Timothy 6: 9-10; Tang & Chiu, 2003)
Proposition Hypothesis
Proposition: The Love of Money
Poverty consists, not in the decrease of one’s possessions, but in the increase of one’s greed. Plato (427-347 BC)
Whoever loves money never has money enough; whoever loves wealth is never satisfied with his income. (Ecclesiastes 5:10)
Corruption: A multilevel real-world phenomenon
Bad Apples, Bad Cases, and Bad Barrels (Kish-Gephart, Harrison, & Treviño, 2010)
Bad Apples: Individual differences; LOM (Level 1) Bad Cases: Context Sensitive (within Organization,
experienced by people); PSQ (Level 1) Bad Barrels: General Organizational Environment
(climate/culture); CPI (Level 2) at the entity level Unethical Choice (OD): Corrupt Intent (Dependent
Var.)
Theory of Planned Behavior
1. Attitude* Behavior Intention*
2. Subjective Norm* 3. Perceive Control (Ajzen, 1991)
The Love of Money is the Root of All Evil
Love of Money (LOM) Corrupt Intent
Justice and Deviant BehaviorGood vs. Bad Barrels (CPI)
Stealing in the name of justice (Greenberg, 1993, 2002)
Pay satisfaction (Heneman & Judge,
2000) reflects perceptions of pay equity and distributive justice.(Cohen-Charash & Spector, 2001; Colquitt, Conlon, Wesson, Porter, & Ng, 2001; Gino & Pierce, 2009; Greenberg, 1990; Huseman, Hatfield, Miles, 1987; Moorman, 1991)
CPIIs a composite index that draws on 14 expert
opinion surveys Provides data for 180 countries and
territories on a scale from zero to ten, 10 = low levels of perceived corruption0 = high levels of perceived corruption < 5 = "serious" perceived levels of
corruption,< 3 = "rampant" corruption
The Income Pyramid Prahalad & Hammond (2002)
Harvard Business Review GDP CPI (TI)
1. GDP > $20,000 CPI > 6.52. $20,000 > GDP > $2,000 6.4 > CPI >
3.53. GDP under $2,000 CPI under
3.4 High GDP High CPI (Low Corruption)
Love of Money Corruption Pay Satisfaction as a Moderator CPI as a Moderator 3-Way Interaction: Love of Money, Pay
Satisfaction, CPI on Corrupt Intent Cross-Level Analysis (Hitt, Beamish, Jackson, & Mathieu,
2007) Mplus (Muthén & Muthén, 1998-2010.
Method N = 6,382
High CPI Group (n = 1,956, 8 entities): the USA, Belgium, Australia, France, Spain, Singapore, Hong Kong, & Portugal;
Medium CPI Group (n = 2,763, 14 entities):
Slovenia, South Korea, Taiwan, Malta, Oman, Hungary, Mexico, South Africa, Malaysia, Thailand;
Brazil, Bulgaria, Peru, & Turkey;
Low CPI Group (n = 1,663, 9 entities): Croatia, Russia, Romania, Macedonia, China, Egypt, the Philippines, Congo, & Nigeria.
Sample N = 6,382 GDP = $13,800 CPI = 5.25 Age = 34.56 Yr. Gender = 51% Male Education = 15.39 Yr
The Love of Money Scale
Factor 1: Rich (Affective)1. I want to be rich.2. It would be nice to be rich.3. Having a lot of money (being rich) is good.
Factor 2: Motivator (Behavior)4. I am motivated to work hard for money.5. Money reinforces me to work harder.6. I am highly motivated by money.
Factor 3: Importance (Cognitive)7. Money is good.8. Money is important.9. Money is valuable.
(Cited in: Colquitt et al., 2011; Furnham & Argyle, 1998; Kish-Gephart et al., 2010; McShane & Von Glinow, 2008; Milkovich, Newman, & Gerhart, 2011; Rynes & Gerhart, 2000; Tang, 1992, 1993; Tang & Chiu, 2003)
Corrupt Intent Organizational
Deviance (Robinson & Bennett, 1995)
1. Reveal company secrets for several million dollars2. Accept money, gifts, and kickbacks from others3. Sabotage the company to get even due to unfair treatment 4. Lay off managers to save the company money and increase
my personal bonus 5. Abuse the company expense accounts and falsify
accounting records6. Overcharge customers to increase sales and to earn higher
bonus
7. Take merchandise and/or cash home. (Cited in: Bateman & Snell, 2011; Kish-Gephart et al., 2010; Chen & Tang, 2006; Tang & Chen, 2008, Tang & Chiu, 2003;
PSQ (4-factor, 18 Items)
1. Pay Level 2. Pay Raise3. Benefit4. Pay Administration
(Heneman & Schwab, 1985; Judge & Welbourne, 1994; Williams, McDaniel, & Nguyen, 2006)
Mplus Estimate S.E. Est./S.E. p-Value
Within Level Corrupt Intent ON Love of Money 0.14 0.08 1.79 0.07 (p < .10)
Pay Satisfaction 0.02 0.08 0.19 0.85 Residual Variances Corrupt Intent 0.31 0.03 10.01 0.00***Between Level S1† ON CPI -0.01 0.00 -2.61 0.01** Corrupt Intent ON CPI 0.03 0.02 1.57 0.12 Intercepts Corrupt Intent 1.39 0.30 4.69 0.00*** S1 0.03 0.03 0.97 0.34 Residual Variances Corrupt Intent 0.05 0.01 3.19 0.00*** S1 0.00 0.00 2.55 0.01**
†The random slope S1 is defined by the linear regression of the dependent variable corrupt intent on the interaction effect between love of money and pay satisfaction.
Dawson & Richter (2006) JAP Slope 3 > 4*
Love of Money Corrupt Intent: Magnitude (Intercept)
Highest: High Pay Satisfaction + Low CPI
Lowest: High Pay Satisfaction + High CPI
Love of Money Corrupt Intent: Intensity (Slope)
Highest: Low Pay Satisfaction + High CPI
Lowest: Low Pay Satisfaction + Low CPI
LOM, CEV, CPI on CorruptionSlopes 4 < 1**, 2*, & 3***
Love of Money Corrupt Intent: Magnitude (Intercept)
Highest: Low CEV + Low CPI
Lowest: High CEV + High CPI
Love of Money Corrupt Intent: Intensity (Slope)
Highest: Low CEV + High CPI
Lowest: Low CEV + Low CPI
Same Magnitude and Intensity:Low CEV/High CPI vs. High CEV/Low CPI
Conclusion Love of Money Corrupt Intent High Pay Satisfaction + Low CPI
Highest Magnitude (The Matthew Effect)
Low Pay Satisfaction + High CPI Highest Intensity (Justice)
Pay Satisfaction plays a different role in High vs. Low CPI entities
Conclusion Low CEV/High CPI = High CEV/Low
CPIMagnitude/Intensity Same
High CPI:Pay Satisfaction & CEV are Important
CEOs have control over Pay Satisfaction & CEV
Conclusion: The Matthew Effect “To anyone who has, more will be
given and he will grow rich; from anyone who has not, even what he has will be taken away” (Matthew 13:
12). (Merton, 1968; Tang, 1996, Tang et al., 2000)
“When cheating is one step removed from cash”, people tend to “justify” their dishonesty easily (Ariely,2008: HBR, 24).
Thank YOU Very Much! Danke Dankeshen Děkuji Dziękujemy Grazie Hvala vam Kiitos Merci Muchas Gracias Obrigado RingraziarLa Takk Deg Teşekkür Ederiz Va multumesc Vi tackas Спасиб ありがとう 너를 감사하십시요 Σας ευχαριστώ רבה תודה متشکرم धन्यवा�द ขอบคุ�ณคุ�ณ 謝謝 谢谢 Please contact Dr. Tang at:
A New Cross-Cultural Study
100 Data Sets (Groups) for Each Country1 Manager3 Subordinates: A, B, C
Manager – Subordinate AManager – Subordinate BManager – Subordinate C
Bor-Shiuan Chen: Paternalistic LeadershipICP, July 21, 2008, Berlin, Germany
Contact Dr. Thomas Tang at [email protected]
26 Countries: Belgium,* China, France, Greece, Hong Kong,
Hungary, India, Indonesia, Italy, Japan, Kyrgyzstan, Malaysia, Mexico,* Nigeria, Poland, Portugal, Russia, Sudan, Singapore,* South Africa, South Korea,* Taiwan,* Thailand,* Turkey, Ukraine*, the US.
*Data Collection Completed