In this topical book, Boudewijn de Bruin examines the ethical 'blind spots' that lay at the heart of the global financial crisis. He argues that the most important moral problem in finance is not the ...'greed is good' culture, but rather the epistemic shortcomings of bankers, clients, rating agencies and regulators. Drawing on insights from economics, psychology and philosophy, de Bruin develops a novel theory of epistemic virtue and applies it to racist and sexist lending practices, subprime mortgages, CEO hubris, the Madoff scandal, professionalism in accountancy and regulatory outsourcing of epistemic responsibility. With its multidisciplinary reach, Ethics and the Global Financial Crisis will appeal to scholars working in philosophy, business ethics, economics, psychology and the sociology of finance. The many concrete examples and case studies mean that this book will also prove useful to policy-makers and regulators.
The ethical practices of credit rating agencies (CRAs), particularly following the 2008 financial crisis, have been subject to extensive analysis by economists, ethicists, and policymakers. We raise ...a novel issue facing CRAs that has to do with a problem concerning the transmission of epistemic status of ratings from CRAs to the beneficiaries of the ratings (investors, etc.), and use it to provide a new challenge for regulators. Building on recent work in philosophy, we argue that since CRAs have different stakes than the beneficiaries of the ratings in the ratings being accurate, what counts as knowledge (and as having ‘epistemic status’) concerning credit risk for a CRA may not count as knowledge (as having epistemic status) for the beneficiary. Further, as it stands, many institutional investors (pension funds, insurance companies, etc.) are bound by law to make some of their investment decisions dependent on the ratings of officially recognized CRAs. We argue that the observation that the epistemic status of ratings does not transmit from CRAs to beneficiaries makes salient a new challenge for those who think current regulation regarding the CRAs is prudentially justified, namely, to show that the harm caused by acting on a rating that does not have epistemic status for beneficiaries is compensated by the benefit from them acting on a CRA rating that does have epistemic status for the CRA. Unlike most other commentators, therefore, we offer a defeasible reason to drop references to CRAs in prudential regulation of the financial industry.
The global financial crisis has led to a surprising interest in professional oaths in business. Examples are the MBA Oath (Harvard Business School), the Economist's Oath (George DeMartino) and the ...Dutch Banker's Oath, which senior executives in the financial services industry in the Netherlands have been obliged to swear since 2010. This paper is among the first to consider oaths from the perspective of business ethics. A framework is presented for analysing oaths in terms of their form, their content and the specific contribution they make to business ethics management: oaths may foster professionalism, facilitate moral deliberation and enhance compliance. This framework is used to analyse and evaluate the MBA Oath, the Economist's Oath and the Banker's Oath as well as various other similar initiatives.
This paper presents new evidence on the impact of socioeconomic status (SES) and education on knowledge attribution. I examine a variety of cases, including vignettes where agents have been ...Gettiered, have false beliefs, and possess knowledge (according to orthodoxy). Early work investigated whether SES might be associated with knowledge attribution (Weinberg et al. in Philos Top 29(1–2):429–460, 2001; Seyedsayamdost in Episteme 12(1):95–116, 2014). But these studies used college education as a dummy variable for SES. I use the recently developed Great British Class Survey (Savage et al. in Sociology 47(2):219–250, 2013) to measure SES. The paper reports evidence against an association between SES and patterns of knowledge ascription, and reports mixed evidence about education effects.
Epistemic Virtues in Business de Bruin, Boudewijn
Journal of business ethics,
04/2013, Volume:
113, Issue:
4
Journal Article
Peer reviewed
This paper applies emerging research on epistemic virtues to business ethics. Inspired by recent work on epistemic virtues in philosophy, I develop a view in which epistemic virtues contribute to the ...acquisition of knowledge that is instrumentally valuable in the realisation of particular ends, business ends in particular. I propose a conception of inquiry according to which epistemic actions involve investigation, belief adoption and justification, and relate this to the traditional 'justified true belief' analysis of knowledge. I defend the view that epistemic virtues enable and/or motivate people to perform epistemic actions. An examination of the key epistemic virtues of love of knowledge, epistemic courage, temperance, justice, generosity and humility provides some initial evidence suggesting that the way epistemic virtues enable or motivate is by countering a number of biases that have been uncovered by behavioural economics, and also indicates ways in which the instrumental epistemic value view is superior to other approaches to epistemic virtue offered in the literature.
This article applies philosophical work on epistemic injustice and cognate concepts (such as epistemic self-confidence) to study gender and racial disparity in financial markets. Members of ...disadvantaged groups often receive inferior financial services (they pay higher interest rates on loans, their loan applications are more likely to be rejected, etc.). In most jurisdictions, it is illegal to provide discriminatorily disparate treatment to groups defined by gender and skin colour. Racial disparity in financial services is generally considered to be discriminatory (and therefore illegal). The standard view among most regulators is that
gender
disparity is
not
discriminatory, though. Through an analysis of various exemplary cases, I propose
testimonial
injustice as a candidate explanation for some of the existing forms of racial disparity found in financial services. I show how prejudices about gender and finance decrease
epistemic self
-
confidence
, and how this leads to gender disparity. And I consider particularly intractable forms of
self
-
fulfilling
testimonial injustice.
This paper presents two studies on the development and validation of a ten-item scale of epistemic vice and the relationship between epistemic vice and misinformation and fake news. Epistemic vices ...have been defined as character traits that interfere with acquiring, maintaining, and transmitting knowledge. Examples of epistemic vice are gullibility and indifference to knowledge. It has been hypothesized that epistemically vicious people are especially susceptible to misinformation and conspiracy theories. We conducted one exploratory and one confirmatory observational survey study on Amazon Mechanical Turk among people living in the United States (total
N
= 1737). We show that two psychological traits underlie the range of epistemic vices that we investigated: indifference to truth and rigidity. Indifference manifests itself in a lack of motivation to find the truth. Rigidity manifests itself in being insensitive to evidence. We develop a scale to measure epistemic vice with the subscales indifference and rigidity. The Epistemic Vice Scale is internally consistent; has good convergent, divergent, and discriminant validity; and is strongly associated with the endorsement of misinformation and conspiracy theories. Epistemic vice explains additional variance in the endorsement of misinformation and conspiracy theories over and above demographic and related psychological concepts and shows medium to large effect sizes across outcome measures. We demonstrate that epistemic vice differs from existing psychological constructs, and show that the scale can explain individual differences in dealing with misinformation and conspiracy theories. We conclude that epistemic vice might contribute to “postfactive” ways of thinking.
We present an argument against a standard evidentialist position on the ethics of belief. We argue that sometimes a person merits criticism for holding a belief even when that belief is well ...supported by her evidence in any relevant sense. We show how our argument advances the case for anti-evidentialism (pragmatism) in the light of other arguments presented in the recent literature, and respond to a set of possible evidentialist rejoinders.
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