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Wall Street to Main Street: Economic Disparity has One Common Concern

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The anti-corporation protests that now sprung around the world lacks contemplation of one common concern: the undertow that ostensibly wafts in corporations exist in our society too. The tentacles of economic muddles that we are after has it’s root in our societal fabric and belief system as much as it is in the prevailing discernment of economic theorization- a paradoxical composition that is complex and have been the debate of our time. While being vocal against this predicament and demanding accountability are essential so do our introspection. It is in essence a clustered behavioral pathology that needs necessitate a behavioral change. This article presents an argument on the economic disparity predicament, challenges the current economic theorization and imparts a solution that has far lasting impact.

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Wall Street to Main Street: Economic Disparity has One Common Concern

  1. 1. Wall Street to Main Street: Economic Disparity has One Common Concern Dhiman Deb Chowdhury, MBA Doctor of Business Administration (DBA) Studies Department of Management, Aberdeen School of Business, The Robert Gordon University, UK. & Director of Technical Program & Project Management, Allied Telesis, Inc, San Jose, CA, USA Email: dhiman.chowdhury@yahoo.com Blog: http://dhimanchowdhury.blogspot.com Homepage: http://dhimanchowdhury.com COPYRIGHT © 2011. DH I MAN CHOWDHURY. ALL RIGHTS RES ERVED.T he continued anti-corporation protests that now sprung around the world lacks contemplation of one common concern: the undertow that ostensibly wafts in corporations exist in our society too. In fact, we are in part responsible. The muddles we encountering today are a derivative of ouroften confusing world view. From Wall Street to Main Street we are in it together. So, if we think“Occupying Wall Street” will somehow eradicate our economic woe or economic inequalities, we arenaïve. Problem is much complex; it is a debate of our time. A paradox that innately question continuedeconomic progress. Yet, unequivocally we need continued economic progress for a perceived betterworld. Or is it? Theories abound including mine that economic progress can coincide with better world,yet I defer from others on the notion that solution to this predicament is “behavioral” in nature. The“Corporate Greed” as we connote today has it’s root in the very notion of economics and economicmodels, which simply discount interconnectedness of the human systems and that of biosphere system.
  2. 2. High Entropy Resource Extraction Wastes Firms En er gy BIOSPHERE Other Inputs Labor & Society Low Entropy Products & Services Households Wastes Environmental InputsFigure 1. Interconnected economic and biosphere system (Chowdhury, 2011).This assumption created an ordered set of values that defines our attitude and in turn behavior leadingto the obfuscation. Have we considered Aristotle’s “Nicomachean Ethics” (Younkins, 2011) orChanakya’s (Kautilya) “virtuous cycle of economic growth” model (Sihag, 2007), antecedents ofeconomics or economic theorization would have been different. Nonetheless, in absence of thedissented ancient wisdoms in ethical business and economics, we are left with a world view thatinnately rejects “human value” proposition.Bhutan, a tiny kingdom of the Himalayas created GNH (Gross National Happiness) in place of GDP tomeasure it’s progress (Thinley, 2005), an interesting and pragmatic model of sustainable developmentthat has global ramification. GNH conjectures a holistic purview of human needs that both physical andmental and the corollary of this that the model seeks to “promote a conscious, inner search forhappiness and requisite skills which must harmonize with beneficial management and development ofouter circumstances” (Thinley, 2005). Central to this formulation is that GNH emphasizes on “HumanValues” (Chowdhury, 2011) in economic progress including development and commerce.
  3. 3. We too want “Happiness” as the ultimate, yet our world view constraints us to believe that physicalwellbeing is in essence the pathways to the said. Rejection of this viewpoint has been a defactoformulation in management science, “Maslow’s Hierarchy of Needs” (Mathes, 1981). We are, however,misconstruing this with self-centered view of physical wealth possession as the way to buy happiness.Figure 2. Influence of behavioral norm in society and in Organizations (Corporations) (Chowdhury, 2011).So, if we are witnessing this self-centered view of what we called “greed” in individuals like BernieMadoff (Creswell & Thomas, 2009; Lenzner, 2008) or in business magnets like Kenneth Lay (Healy &
  4. 4. Palepu, 2003; MSNBC, 2006; NYTIMES, 2011), we should not be surprised, after all it’s a byproduct ofour social state.Hence, introspection is needed. What we are dealing here is a behavioral pathology that far reachingthan our common understandings. I contended that solution to our predicament thus needs abehavioral change which brings together human values and institutions. As it is applicable toorganization so do in our societies. I call this formulation OCBS (Organizational Citizenship Behaviortowards Sustainability) (Chowdhury, 2011). It is a framework that innately finds common ground, if notwin-win paradigm, a mutually beneficial schema for the subjects. The OCBS posits a behavioralaugmentation that is pragmatic and judicious and deviates in few behavioral dimensions from thosedefined in the “OCB (Organizational Citizenship Behavior) (Organ, 1988, 1990, 1997; Organ, Podsakoff &MacKenzie, 2006; Organ & Ryan, 1995), a famous postulation of Prof Dennis W. Organ. In particularOCBS disagree with “compliance” behavioral dimensions of OCB and put forward a normativepostulation of “controlled discord” to foster creativity and productivity. Many researches on OCB foundsignificant correlations between OCB and productivity (Podsakoff & MacKenzie, 2006) among manyother elements e.g. job satisfaction, customer service and quality etc. These findings draw my interest inparticulars sets of behavioral dimensions that, as per my meta-analyses, depict the potentiality ofeffecting entailed behavioral change towards sustainable corporation and sustainable world – aparadigm shift for good. This preliminary observation later espoused through a global survey(Chowdhury, 2011) that measures the presence of different dimensions of OCBS and it’s impact tocorporations, found there is a significance correlation between OCBS and long term viability ofcorporations through two moderators: Proactive Competence (.580; P <.000) and Creative Competence(.599; p <.000).More importantly, respondents who identified presence of OCBS in their workplace environmentindicated “proactive” and “creative” competence of 8 on a scale of 1 to 10. A quantitative analysis basedon the global survey result depicts Proactive and creative competence has significant correlation withProfitability & Stakeholders’ Equity, Governance, Innovation, Market Leadership, Human Capital and CSRand Environmental Performance. This finding depicts a very natural predisposition of humanproductivity and creativity.
  5. 5. .515 P<.000 Environmental Performance .618 P<.000 .531 P<.000 .503 P<.000 Profitability .749 P<.000 .453 P<.000 Market Leadership .638 .599 .676 P<.000 P<.000 Creative P<.000 Competence Corporate Citizenship .7 P< 15 .694 OCBS . 00 P<.000 0 P<.000 .924 .6 .00 P< 15 0 .675 P<.000 Innovation .526 .6 .00 P< 71 0 P<.000 .760 P<.000 .518 P<.000 .580 Proactive .725 P<.000 Competence P<.000 Human .612 Capital P<.000 .668 P<.000 .742 P<.000 GovernanceFigure 3. The diagrammatical representation of OCBS and its correlation with two moderators; creative & proactivecompetence which in turn having stronger correlation with many independent variables (Chowdhury, 2011).The “Hawthorne Study” (Franke & Kaul, 1978), an early (1927 - 1932) investigation on employeebehavior and productivity influence found certain environmental preconditions encourage the
  6. 6. productivity. This finding is the precursor of many researches that later followed. Moreover, humanfactor is central to many management subjects including Organizational Behavior and Human ResourcesManagement etc.Nonetheless, though productivity and services are influenced by human factors, economiccontemplations are oblivious of this fact. This in part contributes to obfuscation in our present-day socialstate.Imperative to this abstraction is, therefore, a behavioral change that purview the holistic aspect ofsustainability considering the harmonious whole: human and biosphere systems; a conjecture thatinnately reduces entropy in societal, organizational, political and environmental system.Reference 1. Chowdhury, D.D., 2011. Organizational Citizenship Behavior towards Sustainability (OCBS): An Evaluative Report. Doctor of Business Administration Studies, Aberdeen Business School. The Robert Gordon University (RGU). 2. Creswell, J. & Thomas, L., 2009. The Talented Mr. Madoff. The New York Times. Available online at http://www.nytimes.com/2009/01/25/business/25bernie.html?pagewanted=all . 3. Franke, R. H. & Kaul, J. D. , 1978. The Hawthorne experiments: First statistical interpretation. American Sociological Review, 1978, 43, 623-643 4. Healy, P.M. & Palepu, K.G., 2003. The Fall of Enron. The Journal of Economic Perspectives, Volume 17, Number 2, 1 June 2003 , pp. 3-26(24). American Economic Association. 5. Lenzner, R., 2008. Bernie Madoffs $50 Billion Ponzi Scheme. Forbes.com. Available online at http://www.forbes.com/2008/12/12/madoff-ponzi-hedge-pf-ii-in_rl_1212croesus_inl.html . 6. Mathes, E.W., 1981. Maslows Hierarchy of Needs as a Guide for Living. Journal of Humanistic Psychology October 1981 vol. 21 no. 4 69-72. SAGE Publications. 7. MSNBC, 2006. Enron founder Ken Lay dies of heart disease: Ex-Enron exec convicted of helping perpetuate huge business fraud. MSNBC. Available online at http://www.msnbc.msn.com/id/13715925/ns/business-corporate_scandals/t/enron-founder- ken-lay-dies-heart-disease/#.TpsseJuImU8 . 8. NYTIMES, 2011. Kenneth L. Lay: News about Kenneth Lay, including commentary and archival articles published in The New York Times. The New York Times. Available online at http://topics.nytimes.com/topics/reference/timestopics/people/l/kenneth_l_lay/index.html . 9. Organ, W.D., 1988. Organizational Citizenship Behavior: The good soldier syndrome. Lexington, MA. 10. Organ, W.D., 1990. Fairness, productivity and organizational citizenship behavior: Tradeoffs in student and manager pay decisions. Paper presented at the meeting of the Academy of Management, San Francisco.
  7. 7. 11. Organ, W.D., 1997. Towards an explication of ‘morale”: In search of the “m” factor . In C.I. Copper & S.E. Jacksons (Eds) creating tomorrow’s organizations. John Wiley & Sons.12. Organ, W.D, Podsakoff, M.P. & MacKenzie, B.S., 2006. Organizational Citizenship Behavior: Its Nature, antecedents, and Consequences. Foundation for Organizational Science: SAGE Publications.13. Organ, W. D. & Ryan, K., 1995. A Meta-Analytic Review of Attitudinal and Dispositional Predictors of Organizational Citizenship Behavior. Personnel Psychology Inc.14. Sihag, B.S., 2007. Kautilya on institutions, governance, knowledge, ethics and prosperity. Humanomics, Vol. 23 Iss: 1, pp.5 – 28. Emerald Group Publishing Ltd.15. Thinley, L.J., 2005. Rethinking Development: Local Pathways to Global Wellbeing. The Second International Conference on Gross National Happiness. GPIAtlantic. Available online at http://www.gpiatlantic.org/conference/proceedings/thinley.htm .16. Younkins, E.W., 2011. Aristotle and Economics. Le Quebecois Libre. Available online at http://www.quebecoislibre.org/05/050915-11.htm

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