This study examines the impact of national culture on ethical decision making. We theorize and test a mediation model where country of origin influences perceptions of justice and power distance, which in turn influence behavioral intentions in regard to ethical dilemmas.
Our sample includes accounting students from four countries: China, Japan, Mexico, and the U.S. We find that country of origin, justice perceptions, power distance perception, and gender are all related to ethical decision making. We investigate these relationships with two different ethical scenarios, and find that these relationships differ between the two contexts. Additionally, power distance and justice partially mediate the relationship between country of origin and ethical decision making. We find that gender is significantly related to ethical decision making in one of the two scenarios, and explore gender differences in all of the measured constructs across countries.
Finally, we contrast the various measures of justice, power distance, and agreement with behavioral intentions in the two ethical scenarios between countries. We find that the two eastern countries (China and Japan) and the two western countries (U.S. and Mexico) demonstrate expected East-West patterns in power distance. However, this East-versus-West pattern is not supported when considering between-country differences in justice, agreement with the layoff decision, and agreement with whistleblowing.
Globalization defines the business world today, yet globalization also leads to many types of misunderstandings regarding ethics, motives, and trust. We apply the theory of social contracts for the purpose of aiding the understanding of moral diversity arising from globalization. Specifically, we seek to better understand how country of origin, and role within country, lead to community “microsocial” norms that inform social contract ethical judgments. A total of 695 managerial accounting professionals and accounting students from Italy and the U.S. completed the survey. Employing a moderated mediation model, we find that country of origin is significantly related to intended behaviors in two business situations, and this relationship is mediated by social contract ethical judgment. Further, the impact of national culture on social contract ethical judgment is moderated by role (professional versus student). Multiple mediation analysis supports our contention that contractual evaluations precede moral equity assessments and that both contractual and moral equity ethical judgments affect ethical intentions.
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