Abstract Most people assume that a system of criminal law is necessary to preserve order in society. But this is because most people also assume that there is no other option, and that a world without criminal law is one with no mechanism for discouraging violent, harmful, and dishonest actions. This chapter argues that this is not a proper comparison. It presents an analysis of the historical development of the criminal law and the psychology and philosophy of punishment to show that the underlying system of tort law can supply all the order-providing service currently provided by the criminal law, and can do so in a neutral and more just manner than the contemporary criminal law.

Abstract Libertarian philosophers of law often argue that unless law arises from some express or implicit social contract by which individuals consent to be bound, it constitutes unjustified coercion that subjects some human beings to the will of others. This book argues that this is a false dilemma. Law can arise through a process of unplanned evolution in which those subject to law are bound, but not by the will of any identifiable human beings. Although law is inherently coercive, it is not inherently a vehicle for domination. Anglo-American common law that evolves without a guiding human intelligence is this type of law. This book maintains that the common law generative process can provide all the law that is needed to maintain a peaceful, prosperous society.

Abstract This chapter traces the historical development of the common law. In doing so, it distinguishes the customary law and old common law from legislation and the modern common law, and goes on to show how customary law and the old common law form a body of nonpolitically generated law. It then demonstrates how a modernized version of the customary law/old common law can still function in our contemporary society, and that this law is sufficient to support a peaceful and prosperous society. Because this law does not depend on the existence of the state, it is the law of anarchy.

Abstract The realm of speech protected by the First Amendment is perennially contentious. This contention arises from the mistaken view that speech must either be unregulated or regulated by the state. This overlooks the regulation of speech that comes from common law civil liability. In a liberal society, the desideratum is not free speech, but free and responsible speech. The common law links freedom to responsibility. This chapter demonstrates how, in the absence of the political regulation of speech, common law regulation—defamation, negligence, misrepresentation, tortious interference, etc.—provides all that is necessary to maintain the proper balance between free and responsible speech.

Abstract This chapter argues that there can be a duty to obey the law of anarchy. It distinguishes between political obligation—the duty to obey the state—and the duty to obey the law, which, as the preceding chapter demonstrates, need not be created by the state. When the law is created by the evolutionary forces of the customary and common law, the law can bind individuals without subjecting them to the conscious control of any other human beings. This implies that there can be a meaningful conception of the rule of law when the law consists of customary law or common law. This, in turn, implies that there can be a well-grounded ethical duty to obey the law.

Abstract Business ethics primarily concerns how businesses conduct themselves and how they make their money. Sometimes businesspeople act badly because they suffer from moral confusion—that is, they are genuinely unsure what moral principles apply to their situation or how to apply them correctly. There are at least five major principles of business ethics which are inherent or built-in to the very idea of doing business. These include that personal responsibility is inalienable, that we must respect the autonomy of others, that coercion, discrimination, and deception are forbidden, and that contracts must be honored. Further, building these ethical principles into each stage of the strategic planning process helps to ensure that businesses act well.

Moral confusion in business ethics and corporate social responsibility often stems from treating ethics and law as if they were the same. Ethics and the law often overlap and sometimes conflict. They are distinct categories. Laws may enforce people’s ethical obligations. But they may also contravene them and require unethical action. Because the law has no independent moral authority, business people are always required to ask themselves whether compliance with the law is the right course of action. When the law prescribes oppressive or unjust conduct, they may have an ethical duty not to obey the law.

Diffusion of responsibility refers to the problem that when something is everyone’s job, it in effect ends up being nobody’s job. This explains why many collective problems arise. People face perverse incentives to free ride on others’ actions and not to do their part. As a result, agents often think in short-term rather than long-term ways. Problems such as climate change can be modeled as instances of the tragedy of the commons, one form of a collective action problem that arises due to perverse incentives created by the diffusion of responsibility.

Sometimes voluntary agreements that are beneficial to all parties can still be unethical. This occurs when the benefits of the agreement are unfairly divided among the parties. The benefits of a mutually beneficial transaction might be exploitative, meaning that one party unconscionably takes advantage of the vulnerability of another party. World poverty, globalization, and environmental disasters present a special challenges where exploitation could occur, but also where people’s good intentions might cause them to refuse to make trades that are beneficial for fear of being exploitative.

It is useful to model the temptation to act wrongly using the prisoner’s dilemma, one of the most important games in game theory. The prisoner’s dilemma appears to show that the pursuit of self-interest can paradoxically lead to situations in which everyone makes choices they know will undermine their self-interest. However, introducing the possibility of repeated, self-sorting prisoner’s dilemmas with reputation effects reveals something important about the connection between self-interest and morality: We have strong incentives not to cheat because in the long run, we do best by developing the reputation for being honest. However, unfortunately, this also introduces an incentive to exaggerate our moral goodness and to engage in moral grandstanding.

It is useful to model the temptation to act wrongly using the prisoner’s dilemma, one of the most important games in game theory. The prisoner’s dilemma appears to show that the pursuit of self-interest can paradoxically lead to situations in which everyone makes choices they know will undermine their self-interest. However, introducing the possibility of repeated, self-sorting prisoner’s dilemmas with reputation effects reveals something important about the connection between self-interest and morality: We have strong incentives not to cheat because in the long run, we do best by developing the reputation for being honest. However, unfortunately, this also introduces an incentive to exaggerate our moral goodness and to engage in moral grandstanding.

Business Ethics for Better Behavior concisely answers the three most pressing ethical questions business professionals face: 1. What makes business practices right or wrong? 2. Why do normal, decent businesspeople of goodwill sometimes do the wrong thing? 3. How can we use the answer to these questions to get ourselves, our coworkers, our bosses, and our employees to behave better? Bad behavior in business rarely results from bad will. Most people mean well much of the time. But most of us are vulnerable. We all fall into moral traps, usually without even noticing. Business Ethics for Better Behavior teaches business professionals, students, and other readers how to become aware of those traps, how to avoid them, and how to dig their way out if they fall in. It integrates the best work in psychology, economics, management theory, and normative philosophy into a simple action plan for ensuring the best ethical performance at all levels of business practice. This is a book anyone in business, from an entry-level employee to CEO, can use.

Every business faces internal conflicts of interest. They must determine how to motivate employees to cooperate in a productive manner, while also limiting the temptation to exploit the business for private gain. Designing good incentives is essential. If inputs are easy to measure, employees can be compensated based on how much work they do, but if inputs are hard to measure, it may be more effective to tie compensation to a firm’s output in the form of stock options and profit-sharing. However, care must be taken to ensure that executives do not misrepresent the value of the company or engage in fraud in order to inflate stock prices. Compensation packages that lengthen the vesting period of stock options and allow ill-gotten gains to be clawed back, as well as whistleblower programs that reward those who expose fraud, can help prevent bad behavior and ensure that business leaders focus on genuine productivity.

Moral psychology indicates that we have a range of quirks which lead otherwise well-meaning people to act badly. These quirks include conformity effects, by which we tend to copy what others do regardless of whether it is good or bad and tend to defer to those we see as authoritative. Framing effects—how a problem is presented—can cause us to change our decisions. We suffer from moral blind spots, in which we fail to notice something is at stake because we act on auto-pilot. Further, the matrix task experiment demonstrates a wide range of external factors predictably modify how honest people are.

SMART objectives are Specific, Measurable, Achievable, Relevant, and Time-bound. DUMB values are Disconnected, Unincentivized, Measureless, and Boilerplate. Effective ethical and strategic management techniques promote SMART objectives and avoid DUMB values. However, business leaders often fall into the trap of pursuing DUMB values in part because it allows them to look good without putting much constraints on their actual choices.

People are complicated. Morality is part of what makes us human. We are not just social animals, but animals evolved to have some innate moral concerns. Why, then, do ordinary people sometimes act badly? The answer is: it’s complicated. It’s not as simple as “People are selfish.” Instead, it’s a mix of problems. Sometimes we face bad incentives and take the bait. Sometimes, the problem is that we are conformists who don’t know how to say “no” and don’t even realize saying “no” is an option. Sometimes, the problem is that we operate on auto-pilot; we are blissfully unaware anything morally significant is at stake. Sometimes, the problem is that we suffer from self-deception and so trick ourselves into taking shortcuts. Sometimes, the problem is that we have run out of willpower and we haven’t learned to sustain our moral stamina.

People are evolved to be ethical animals, but also evolved not to be perfectly moral. We suffer from predictable moral failings. Managing for better behaviors requires us to diagnose why good people act badly so that we can form proper strategies for overcoming their foibles. Further, some might be skeptical that there can be a universal ethics and instead assume that ethics is culturally relative. This position, rather than promoting tolerance, requires us to accept absurd conclusions.

Similar to the entertainment industry in the time of the blacklist, a climate of fear has descended on the nation's universities and colleges. It is the fear of being punished, not for what one does, but for what one says. Today, students and faculty frequently refrain from expressing unpopular or “offensive” positions–often conservative, libertarian, or traditional religious positions–for fear of being labeled racist, sexist, homophobic, white supremacist, or of engaging in hate speech. The fear comes in two forms–the fear of being sanctioned by the university or college and the fear of being cancelled by one's fellow students or faculty members. In this article, I argue that these fears result from a set of perverse incentives on campus. I suggest that the only way to counter the fears is by changing the schools' incentive structures. I then show how coupling the addition of a “safe harbor” provision to a school's speech and expression policy with the creation of a pro bono legal organization devoted to the preservation of freedom of speech on campus can effectuate such a change.

People are predominantly but not entirely selfish. However, they do generally have strong degrees of altruistic motivation in certain situations. Good management strategies must be careful not to crowd out intrinsic motivation—in which people do what things for their own sake—for extrinsic motivation—in which people are motivated primarily by rewards and punishments. It is important to structure work environments so that people find their work meaningful. Too much focus on extrinsic motivation can not only cause people to behave morally worse, but to perform worse in general.