Decision making + Ethical behavior in international business

It is known that people in different cultures differ in their decision-making in mixed-motive situations, due to individual interests face collective interests.

Mixed-motive game is a situation in which an individual faces a conflict between maximizing personal interest called defection and maximizing collective interest called cooperation. This game works properly to compare cross-cultural cooperation. This idea of individualism-collectivism put pressure in people decision-making, showing how an individual concerns about those decisions’ consequences for himself as for all.

Talking about individualism-collectivism; individualism can be defined as a social pattern that consists of being more related or closed to the individual interests rather than collective ones. While collectivism is pretty much the opposite, in which collective interests are more important due to seeing him/herself as a part of a group.

Individualists tend to disagree on value attitudes with others, and collectivists are characterized by similarities.

According to Markus and kitayama there are 4 kinds of self: independent or interdependent, and same or different. The combination of this four types can be categorized as horizontal individualism (independent/same) and horizontal collectivism (interdependent/same), vertical individualism (independent/different) and vertical collectivism (interdependent/different).

The horizontal context is focused on maximizing self interest or self goal without a big comparison with others, horizontal people are not too much interested in distinguishing themselves from others or be aware on how others’ action can affect them. It is the opposite thing with the vertical dimension, which emphasizes a “different self” and winning over others. To establish differentiation and better self, vertical individuals pay more attention to environment and others’ actions to accomplish the target.

Ethics is the "discipline dealing with what is good and bad and with moral duty and obligation," "a set of moral principles or value" or "a theory or system of moral values." Ethics assists individuals in deciding when an act is moral or immoral, right or wrong. Ethics can be grounded in natural law, religious tenets, parental and family influence, educational experiences, life experiences, and cultural and societal expectations. 

Ethics in business, or business ethics as it is often called, is the application of the discipline, principles, and theories of ethics to the organizational context. Business ethics have been defined as "principles and standards that guide behavior in the world of business." Business ethics is also a descriptive term for the field of academic study in which many scholars conduct research and in which undergraduate and graduate students are exposed to ethics theory and practice, usually through the case method of analysis.

 What are the impacts of culture in terms of mixed-motive decision making?

Inside a culture there are values, which are assumptions of how people should behave. And there are also beliefs, which are if the people really apply or not their cultural values.

Owing to these concepts, one might say Islamic people would be really influenced on decision-making by their religion values, however some of them might argue that they do not share or agree on certain values preached by their religion, and that they will act based on what they believe is right or wrong, which is an illustration of cultural belief.

Therefore people of a specific culture could lead their decisions, according to beliefs and focus on self- interest, but others could be leaded by national values and make decisions in order to favor collective purposes or vice versa. This is just an example but shows how a random culture aspect affect decision making.

1) Image took from: http://www.forbes.com

2) video source: http://www.youtube.com/watch?v=vSNwcBLwqxM

3) Image took from: http://socrates-greatconversation.blogspot.com

4) Ethics. Retrieved from: http://www.referenceforbusiness.com/management/Em-Exp/Ethics.html

5) Difference between values and beliefs. Retrieved from: http://www.differencebetween.net/language/difference-between-values-and-beliefs/