A game theoretic approach to understanding ethical conformity in marketing

This dissertation extends marketing thought by addressing pressing ethical and strategic issues affecting theory and practice. Specifically, to what extent and under what conditions should firms incorporate a focus on ethics in their marketing strategies and initiatives? I investigate conditions surrounding these strategic marketing considerations with three essays including a mathematical model and two empirical investigations using game theory. The game theoretical model buttressed by the empirical results provide substantive conclusions for marketing ethics at the firm level that traditional limitations in data collection, to date, have precluded.; Focal firms and marketing managers must address the question of to what extent they will focus on ethics in their product offerings and marketing strategies. To further complicate this question, focal firms and managers must also consider the ethical behavior of upstream suppliers and other interfirm partners in such decisions. To probe these research questions, I draw from strategic marketing, economics, and sociological theory. Institutional theory informs on the nature and variety of normative challenges that press upon firms requiring some form of ethical response. I propose the concept of conformity to describe how firms deploy marketing strategies and practices to address social and stakeholder norms. I derive from deviance theory to discuss ethical overconformity, or the exceeding of norms and expectations by firms in their marketing strategies and practices. The theoretical advancement of positive deviance, augmenting traditional negative deviance perspectives, allows a richer conceptualization of firm ethical conformity. Finally, questions of interfirm partner ethical behavior are cast in an agency theoretical perspective to illuminate the relevant information asymmetries involved.; The research questions unfold in three distinct manuscripts. In Paper One, I adopt a game theoretic approach and describe the mathematical models that shape ethical overconformity. Paper Two advances and experimentally tests the theoretical premises derived from the first manuscript. Paper Three employs experimental economics for a more fine-grained understanding of managerial information states relevant to leveraging ethics for strategic advantage, given the behavior of an upstream supplier. Ultimately, the conclusions from each of the three papers contribute to marketing theory and practice, while illuminate promising future research.