56408e8ca7356 Allhoff 2003
56408e8ca7356 Allhoff 2003
56408e8ca7356 Allhoff 2003
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Business Bluffing
Reconsidered Fritz Allhoff
imagine further she tells me thatshe absolutely that the game is played. The second, by Thomas
cannot sell the car for less than
$12,000. Carson, presented a more subtle argument
Assuming that neither one of us is telling the wherein the author reconstrued the concept of
truth, we are about our reservation to an of truth
bluffing lying require implied warrantability
the price above or below which we will and, since business negotiations instantiate a
prices,
no
longer be willing to make the transaction. context wherein claims are not warranted to be
This is certainly a common practice and, true, bluffing is not lying.
-
moreover, is most likely minimally prudent I think that both papers are on the right track
whether our negotiating is bluffing or to the solution to the problem, but that both
adversary
not, it will always be in our interest to bluff. authors' positions are In this paper,
problematic.
Discussions of bluffing in business commonly I will consider the arguments of both Carr and
invoke reservation prices, but need not; one Carson, and Iwill present my criticisms of their
could misrepresent his position in any number ideas. Drawing off of their accounts, Iwill then
of areas including the financial health of a develop my own as to why
argument in
bluffing
company poised for merger, the authority that business ismorally permissible, which will be that
has been to him by the parties that he bluffing is a practice that should be endorsed by
granted
represents,
or even one's enthusiasm about a all rational negotiators.
missibility is either mismotivated or illusory. Two the psychology of the other players, a bold front,
highly influential papers have taken different self-discipline, and the ability to respond quickly
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284 Fritz Allhoff
and to opportunities the lattercase does not provide moral license for
effectively presented by
chance.2 the act against me, consent can similarly not be
Even if we grant Carr that there are no used to legitimize bluffing in the former.
ought to be the case.5 There have been numerous his definition of lying excludes bluffing. Why?
conventions, such as discrimination, that have He argues the second
that requirement, the
nevertheless been immoral. And there have also warrantability of truth, is largely absent in nego
been numerous such as slavery, that tiations. There are some claims made during
practices,
have been sanctioned but that are also negotiations that convention dictates to be
legally
immoral. Facts about the way that the society warranted as true, such as claims to have another
operates or about the way that the law is, can not offer on the table. If I were to claim that I had
be used to derive values. The two
supports that another offer while I did not, this would be a
Carr gives for the moral permissibility of bluffing lie because it would
satisfy both parts of Carson's
are precisely the sorts of considerations that are requirements. Claims about reservation prices,
disallowed in moral philosophy. however, do not carry implied warrantability of
patently
not discuss, a poten - as amatter ever takes such
Carr hints at, but does truth of fact, nobody
tially more promising notion, that of consent. claims to be literally true. Carson therefore thinks
Certainly bluffing in poker, and most likely that bluffing is not lying and should therefore not
bluffing in business, is a practice to which all hold the moral disapprobations that we confer on
involved parties consent, which ismore than can lying.
be said for other conventions. But since the fact There are, I think, two problems with Carson's
value divide makes convention irrelevant, defense of bluffing. The most obvious one is that,
wholly
consent would have to do the entirety of the even if bluffing is not lying, it does not follow
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Business Bluffing Reconsidered 285
objectionable, which many of us would, then the business; Carr uses a poker analogy and Carson
absence of lying alone does not secure moral argues that claims made during bluffing are
license. And if it is not morally objectionable, similar to claims made during the game of Risk.
some argument has to be given as to why; it cer But the problem that both authors have is that
tainly not intuitively obvious that all non-lying they infer moral legitimacy from the rules of
deceptions are morally permissible. Therefore, their games, and this inference cannot be made.
the most that Carson's argument can establish is What we need is not an to convention,
appeal
that bluffing does not carry the same prima facie but rather a moral argument that legitimizes
wrongness that lying does, not that it is morally bluffing within those games and that can be
reservationprices. We
already seen why
have lawyer roles.11 Though the applications have cer
convention alone cannot provide any reason to tainly been controversial, the underlying idea,
think that a practice is morally permissible.8 To role-differentiated morality, has garnered wide
say it another way, we can meaningfully ask support.
whether a practice is morally permissible despite Put role-differentiated
simply, morality
its being conventional. A defense of bluffing must suggests the following three claims:
extend beyond mere conventionality and into the
1. Certain roles make acts that
realm of moral else it is doomed to permissible
philosophy, would otherwise be
violate the fact-value divide. impermissible.
2. Certain roles make acts impermissible that
would otherwise be permissible.
3. Certain roles make acts obligatory that
would otherwise not be obligatory.
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286 Fritz Allhoff
ferentiated morality; this has been done by other which bluffing ismorally permitted. Both Carr
authors (including the two I cited above), and I and Carson suggested that bluffing is permitted
do not feel that I have anything of value to add. in games, and I think that they are exactly right.
What I will say in defense of the idea here is But they got the reason wrong, convention alone
that it has tremendous intuitive resonance, as I cannot deliver moral permissibility. Whatever jus
think can be clearly throughshownexamples. tifies bluffing in these cases needs to have moral,
In support of the first claim, we might say that rather than merely descriptive, force. I think that
soldiers fighting a just war are morally permitted the key to these casesis that the players involved
to kill, whereas ordinary civilians are not. In in the game actually endorse the practice of
support of the second claim, we could suggest bluffing; people play these games for fun, and
that should not have sexual makes the games much more fun. If
college professors bluffing
relationships with their (nor bosses with
students bluffing did not exist in poker, and everyone's bet
their subordinates), regardless of the act being merely reflected the strength of their hands, there
consensual. In support of the third claim, we would be no game at all since the final results
claimthat parents have special obligations would all be made apparent. Thus, as insofar
might
to their children, such as providing for them and anyone even wants to play poker in ameaningful
caring for them, that non-parents would not have way, he is committed to endorsing the practice
towards the same child. I think the self-evidence of bluffing. Bluffing in Risk is similarly
of these examples gives strong support for the explained; bluffing an exciting
adds (though in
notion of role-differentiated morality. this case non-essential) element to the game to
Now, we can return to bluffing and ask which are attracted. If this were not the
players
whether some roles should allow for its moral case, we would certainly expect a proliferation in
that it is pretty clear that
I think strategy games in which there were no
permissibility.12 bluffing
yes, some roles do allow for bluffing, while others via diplomacy, and this is certainly not what we
definitely do not
(though it remains, for now, see. Bluffing, in some games, is a welcome
an open question under which one bluffing in feature in which participants actually want to be
business falls). Some roles clearly do not morally involved.
For consider a rela Is endorsement a moral feature? Absolutely.
permit bluffing. example,
tionship between a husband and a wife. They Imagine that my son takes $20 out of my wallet.
have duties to each other to be honest and not There could be two scenarios leading up to this
to manipulate each other to secure advantages act. In one, he asks me for the money and I
in negotiation. might We even want to say that endorse his taking it (to pay the deliveryperson
negotiating, which is a necessary precondition for for pizza, let's say) and, in the other, he does not
bluffing, is not the sort of activity in which ask and instead takes it without my permission.
husbands and wives should partake. Negotiating Obviously he acted permissibly in the first
assumes conflicting aims of the negotiators and scenario and
impermissibly in the second, and it
them against each other as adversaries, was my approval, or endorsement, of his actions
pits
whereas husbands and wives should, ideally, share that is the only morally relevant difference.
the same goals and cooperate. When disagree Therefore, endorsement carries with it the moral
ments do occur (such as on how much to pay for force to legitimize certain acts (or practices), and
a new is necessary to
house), they should not negotiate against I think that it is precisely what
each other to determine their collective reserva legitimize bluffing in games.14
tion price but rather should debate the issue and I hope to have established both the plausibility
build a consensus as a unified front. I think that of role-differentiated morality and that bluffing
husband or wife is a role
bluffing in which is is permitted in some roles, but not in others. I
not morally but there are others, can now return to my central aim and ask under
permissible,13
such as any fiduciary role wherein one ismorally which category bluffing in business falls. I think
bound to be fully open with another. that bluffing in business is permissible for the
There are, on the other hand, roles under same reason that it is permissible in games,
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Business Bluffing Reconsidered 287
namely that the participants endorse the practice. what those terms will be. Ideally, each party
To explain why, let us return to the example with would like to be able to bluff while having his
which I started. When I go to the car dealer with opponent's position be transparent, but since
a reservation price of $12,000, what that means that is obviously not a possibility, both should
is that, all factors considered, that car has to me welcome as an opportunity to improve
bluffing
a greater than the $12,000 does. their positions.
utility marginally
Ex hypothesi, I am already willing to spend the It is also interesting to note that, without
$12,000; if that were the best that I could do, I bluffing, the idea of negotiations itself almost
would accept the offer. Any price that I can (though not quite) becomes incoherent. Suppose
achieve below $12,000 would obviously be an that bluffing were not practiced, but that parties
improvement on the situation. and merely met and announced their respective reser
Bluffing
negotiating are the mechanisms wherein I can vation prices. I tell the car dealer that Iwill give
achieve a final sale at a price beneath my reser him $12,000 for the car and she tells me that he
vation price and, insofar as any rational agent will take as little as $10,000 for the car. Now
would welcome that end, he should also endorse what? I do not even know how to settle on a
its means. transaction price other than to do something
Furthermore, other than bluffing, I cannot arbitrary such as splitting the reservation window
think of another reasonable procedure for the in half and settling at $11,000. This seems like
buyer to lower
the sale price below my reserva the wrong answer for a number of reasons. Such
tion price (or for the seller to raise the sale price resolutions could be inefficient (i.e. not Pareto
above his reservation price). I might, for optimal), not utilitarian, unfair to those who
example, try to do so by force or threats, but negotiate well, etc.15 Negotiating is, I think, an
these are obviously immoral. I might also make essential part of business. To reach a transaction
outright lies, such as to assert that the dealer price, it makes the most sense for the buyer to
across town has already guaranteed me a lower start low and theseller high, and to reach some
price. As Carson has already argued, this seems agreement in the middle. By announcing reser
seriously immoral. So I think it is quite reason vation prices, we would be creating a system that
able to
suppose not only that the prospective I find less attractive and, furthermore, would give
buyer would endorse bluffing, but that there are the participants every reason to transgress and to
no other reasonable alternatives. bluff.
One response to my position might be that Finally, I think that there really is a lot of merit
bluffing does help the individual but that in in the analogies between business negotiating and
negotiations there is not one, but two bluffers, games (despite the criticisms by Koehn and
and that the addition of the second cancels out others). But I would go further than claiming
all advantage to the first.
Therefore, bluffing that it is like a game, it seems to me that it is a
would should not
actually be endorsed, since it game. Perhaps this is not true in the sense that
yields no expected improvement, and maybe negotiators are drawn to their work because they
even eschewed on the grounds that it takes time find it amusing, this is false in a wide number of
and energy. However, I do not see how the cases and I certainly do not mean to trivialize
addition of another bluffer really changes many serious negotiations. But if two parties
anything. If the car dealer will go as low as come to the negotiating table and the reservation
$10,000 and Iwill pay as high as $12,000, then price of the buyer is higher than the reservation
we agree to (and, ex hypothesi,
would both be price of the seller, then we already know that,
happy with) any transaction at any price between ceteris paribus, the transaction will occur and, fur
and including $10,000 and $12,000. Assuming thermore, it will occur at a price to which both
that the reservation price of the buyer is higher parties are amenable. It seems to me that the
than the reservation price of the seller, the issue occurrence of the transaction and the satisfaction
is not whether the two parties will come to of the parties is what is really important, where
mutually agreeable terms, the question is just the price falls within the reservation window just
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288 Fritz Allhoff
determines what each party gains (in terms of gives false directions by pointing in the wrong direc
tion without This definition results
money not spent or extra money earned) in saying anything.
addition to a mutually beneficial transaction. partly from earlier work by Carson and a criticism
Whether the stakes are millions or not,
of dollars that he consequently received from Gary Jones. To
trace through this, start with Thomas Carson, Richard
the parties are still merely trying to secure money
Wokutch, and James Cox's "An Ethical Analysis of
that they would otherwise be satisfied without.
Deception in Advertising", fournal of Business Ethics
4 (1985), pp. 93-104. Jones's criticism can be found
in "Lying and Intentions", fournal of Business Ethics 5
Notes
(1986) 347-349. And, finally, Carson's response is in
"On the Definition of Lying: A reply to Jones and
1
The first important paper was Albert Carr's "Is Revisions", fournal of Business Ethics 7 (1988), pp.
Business Bluffing Ethical?" Harvard Business Review 509-514.
7
January/February 1968, pp. 143-153. John Beach Carson (1993), pp. 321-322.
8
later reflects upon the treatment that the topic And, in an interesting recent article, Chris Provis
received in the years since Carr's publication (though argues that bluffing (or, more precisely, deception) is
Beach is somewhat critical of this response). See his not as
ubiquitous in business as everyone often
"Bluffing: Its Demise as a Subject unto Itself", Journal assumes; he thinks that the appearance of bluffing can
of Business Ethics 4 (1985), pp. 191-196. Then, often be accounted for by genuine concessions. If
Thomas Carson reconsiders Carr's classic treatment of Provis is correct, then Carson's reliance on conven
the subject and proposes an alternative conception of
tionality is empirically flawed. Or, as I argue, the
business bluffing; see "Second
Thoughts about reliance on convention is conceptually flawed (in
Bluffing", Business Ethics Quarterly 3(4) (1993), pp. order to secure moral permissibility). So, either way,
317-341. There are also numerous other examples the approach will not work. See Provis's "Ethics,
within the literature, I take these to be the and Labor
though Deception, Negotiation", fournal of Business
most
important. Ethics 28(2) (2000), pp. 145-158.
2 9
Carr (1968), p. 72. As I have indicated, other authors have also criti
3
Daryl Koehn has, for example, argued that the cized the two approaches. What I have tried to do
analogy between business and poker is quite weak; however, is be as charitable as
possible:
to grant all
he takes nine features that exist in games and argues of their the adversarial
assumptions (the analogies,
that few, if any, of these exist in business. For the nature of negotiating, Carson's definition of lying,
sake of argument, I am
willing
to grant Carr's analogy; etc.) and then aspired to show that they still cannot,
I think that, even with this analogy, he is unable to even on their own terms, secure their desired con
secure the conclusion that he desires. See Koehn's clusions.
10
"Business and
Game-Playing: The False Analogy", An especially good and influential article is
Journal of Business Ethics 16 (1997), pp. 1447-1452. Richard Wassterstrom's "Lawyer's
as Professionals:
Norman Bowie also argued against the legitimacy of Some Moral Issues", Human Rights Quarterly 5(1)
adversarial models (such as poker) as proper charac (1975).
11
terizations of bargaining and negotiating. See his Monroe H. Freedman, "Professional Responsi
"Should Collective Bargaining and Labor Relations bility of the Criminal Defense
Lawyer: The Three
Be Less Adversarial?", Journal of Business Ethics 4 Hardest Questions", Michigan Law Review 27 (1966).
12
(1985) 283-291. Robert S. Adler and William J. This step of my argument might be overly
Bigoness also challenge adversarial models in their pedantic, and I might fare just as well if I skipped it
work and find Carr's poker analogy to be flawed. See and went directly to arguing for bluffing in business
"Contemporary Ethical Issues in
Labor-Management contexts specifically. However, I do think that it is
Issues in Labor-Management Relations", Journal of an important part of the conceptual framework that
Business Ethics 11 (1992), pp. 351-360. I want to establish.
4 13
Carson (1993), 324-325. This is obviously not to say that husbands or
5
A Treatise ofHuman Nature, ed. P. H. Nidditch, 2nd wives cannot bluff in business situations, just that a
ed. (Oxford: Oxford University Press, 1978) III.Li. husband cannot bluff qua husband nor awife qua wife.
6
Carson (1993), p. 320. I assume that speaker is The husband or wife who bluffs in business is not
placed
in scare
quotes in order to allow for the pos bluffing qua husband or qua wife, but rather qua
sibility of non-verbal lying, such as when someone businessperson.
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Business Bluffing Reconsidered 289
14
John Rawls has argued that it is not morally per and the "Split-the-Difference" Theory ofWage
missible sell oneself into slavery (i.e., even if I endorsed Bargaining', Industrial and Labor Relations Review
the sale, it is still immoral). See his Theory of Justice 31(2).
(Cambridge: Harvard University Press, 1971). This Carr, A.: 1968, 'IsBusiness Bluffing Ethical?' Harvard
poses an interesting objection to my idea that Business Review (Janurary/February).
endorsement alone suggests prima facie permissibility. Carson, T. L.: 1993, 'Second Thoughts about
There are two ways that I could respond. First, I could Bluffing', Journal of Business Ethics 3(4).
disagree with Rawls and argue that any decision made Carson, T. L.: 1988, 'On the Definitions of Lying: A
by free and rational agents should be honored (so long Reply to Jones and Revisions', Jo urnal of Business
as it did not harm others), that to do otherwise would Ethics 1.
show lack of respect for the being's rational nature. I Carson, T. L., R. E. Wokutch and J. E. Cox, Jr.:
am personally inclined towards this view, though I 1985, 'An Ethical Analysis of Decption in
know that many are not. The other way that I could Advertising',Journal of Business Ethics 4.
go would be to argue that Rawls' point merely indi Freedman, M.: 1966, 'Professional Responsibility of
cates that people cannot voluntarily give up their the Criminal Defense Lawyer: The Three Hardest
rights and that consenting to being bluffed is not Questions', Michigan Law Review 27.
problematic since we do not have the moral right to Hume, D.: 1978, A Treatise ofHuman Nature (2nd ed.).
be told the truth. I think that either of these responses P. H. Nidditch (ed.). (Oxford University Press,
could be profitably developed, though I will not do Oxford).
so here.
Jones, G. E.: 1986, 'Lying and Intentions', Journal of
15
The "Split-the-Difference" theory of negotiating Business Ethics 5.
is discussed by Roger Bowlby and William Schriver Koehn, D.: 1997, 'Business and Game-Playing: The
in their "Bluffing and the 'Split-the-Difference' False Analogy', Journal of Business Ethics 16.
Theory of Wage Bargaining", Industrial and Labor Post, F. R.: 1990, 'Collaborative Collective
Relations Review 31(2) (January 1978), pp. 161-171. Bargaining: Toward an Ethically Defensible
Their discussion, however, is quite empirical and Approach to Labor Negotiations', Journal of
numerical rather than normative. Business Ethics 9.
Provis, O: 2000, 'Ethics, Deception, and Labor
Negotiation', Journal of Business Ethics 28.
References Rawls, J.: 1971, A Theory of Justice (Harvard
University Press, Cambridge).
Wasserstrom, R.: 1975, as Professionals:
Adler, R. S. andW. J. Bigoness: 1992, 'Contemporary 'Lawyer's
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