Expectations and Disappointments: Ethical Legitimacy of the U.S. Financial Sector

Susan L. Kirby; Eric G. Kirby; Douglas W. Lyon

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Expectations and Disappointments: Ethical Legitimacy of the U.S. Financial Sector

Susan L. Kirby and Eric G. Kirby

Texas State University, USA

Douglas W. Lyon

Fort Lewis College, USA

Volume 9: 2012, pp. 343-358: ABSTRACT

The 2008 financial crisis has raised serious ethical questions about behaviors associated with the free market system and the effectiveness of undergraduate business ethics education. We offer opposing interpretations of the crisis, a "Markets Work" and a "Critical" perspective, in order to provide students with an opportunity to examine their ethical assumptions. We frame our discussion around legitimacy; therefore, we utilize an institutional theory lens to frame the processes by which financial organizations are rewarded with social legitimacy for using "proper" structures and following "appropriate" procedures and punished when they do not. By presenting these two opposing narratives of the crisis, we provide a richer framework for discussing the crisis and relating it to the larger issue of corporate malfeasance. We draw upon a wealth of readily available, easily accessible material. We identify films, readings, and provide notes that may use to set the direction and tenor of classroom discussion.