Being Ethical Can Hurt Your Income
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This paper empirically investigates the link between ethics, earnings and gender. Using a self-reported measure from a longitudinal survey of registrants for the Graduate Management Admissions Test, we find that ethical character is negatively associated with males’ wages. For females, however, this relationship doesn’t hold. In addition, using measures of the degree to which ethics is emphasized in business school curricula as an indicator for enhancement of individual ethical standards of graduates, we investigate variation in the returns to an MBA degree. We find that the larger the degree to which males report that business education enhanced their ethical character, the lower their wages, holding other aspects of their education constant. For females, however, enhanced ethics through business school is positively and significantly associated with returns to the MBA degree. More objective measures of ethics emphasis in business school curricula provide further support of these findings.
Source: “The Effect of Ethics on Labor Market Success: Evidence from MBAs” from Journal of Economic Behavior & Organization
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