Motivating Whistleblowers

Jeffrey Butler, Danila Serra and Giancarlo Spagnolo

No 1701, Departmental Working Papers from Southern Methodist University, Department of Economics

Abstract: We experimentally investigate employees’ decisions to blow the whistle on a manager whose law-breaking benefits the firm but harms society. We investigate the effects of both financial rewards and non-monetary incentives, in the form of public scrutiny, on whistleblowing as well as their interaction with the visibility of harm, i.e., whether the harm to society stemming from the manager’s malfeasance is known to the general public. Our results suggest that: i) financial rewards substantially increase the likelihood of whistleblowing; ii) public scrutiny and social judgment increase (decrease) whistleblowing when the negative externalities generated by fraud are visible (invisible) to the public. Ancillary results suggest an intriguing relationship between political orientation and responsiveness to public scrutiny.

Keywords: Whistleblowing; fraud; financial rewards; public scrutiny. (search for similar items in EconPapers)
JEL-codes: C92 D04 K42 (search for similar items in EconPapers)
Date: 2017-02
New Economics Papers: this item is included in nep-law
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Citations: View citations in EconPapers (13)

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Related works:
Working Paper: Motivating Whistleblowers (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:smu:ecowpa:1701

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