THE COMPETITIVE ADVANTAGE OF
HONESTY
Mark Pigors, Bettina Rockenbach
THE COMPETITIVE ADVANTAGE OF HONESTY
CONTEXT
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COMPETITIVE MARKETS
COSTS REDUCTIONS
FIRMS LIES TO THEIR WORKERS
CONSUMERS’ BENEFIT FROM DISHONESTY
CONSUMERS’ DECISIONS AND HONESTY
CONSUMERS « PUNISH » FIRMS
HONEST FIRMS SELL MORE
THE COMPETITIVE ADVANTAGE OF HONESTY
CONTEXT
Political
matters
Human
rights
Moral
Beliefs
Animal
welfare
NGOs
Workers’
rights
THE COMPETITIVE ADVANTAGE OF HONESTY
FRAMEWORK
CONSUMER RESEARCH
Previous works on consumers :
honesty  transparency
transparency  buying decisions
Consumer social responsibility
Impact on global consumption
Consumers’ buying decisions
Competitive advantages
THE COMPETITIVE ADVANTAGE OF HONESTY
CONDITIONS
Bertrand Duopoly
Consumers
X2
Firms
X2
Good
X1
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
CONDITIONS
Bertrand Duopoly
(price competition)
Consumers
X2
Firms
X2
Good
X1
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
CONDITIONS
Bertrand Duopoly
Consumers
X2
Firms
X2
Good
X1
fixed valuation
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
CONDITIONS
Bertrand Duopoly
Consumers
X2
Firms
X2
Good
X1
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
CONDITIONS
Bertrand Duopoly
Consumers
X2
Firms
X2
Good
X1
price
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
THE GAME
Price €
Info
Price €
Info  Wage €
Profitability ?
€
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
THE GAME
Profitability
Wage
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
THE GAME
Price
Profitability
Info
Wage
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
THE GAME
Price
Info
Buy
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
THE GAME
NO INFO
WAGE INFO
FULL INFO
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
RESULTS
!
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
RESULTS
!
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
RESULTS
!
ORSEE
THE COMPETITIVE ADVANTAGE OF HONESTY
THE GAME
INFO + HONESTY
PROFITS
WAGES
ORSEE
THE COMPETITIVE ADVANTAGE OF
HONESTY
PRESENTATION IN WORD FORMAT 