An Empirical Investigation of the Ethical Beliefs of Consumers in China
Noel Y.M. Siu Alice S.Y. Hui Betsy Y.Y. Lee Department of Marketing
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An Empirical Investigation of the Ethical Beliefs of Consumers in China
Noel Y.M. Siu, Alice S. Y. Hui and Betsy Y. Y. Lee Department of Marketing Hong Kong Baptist University
For any correspondence, please direct to Noel Y.M. Siu, Department of Marketing, School of Business, Hong Kong Baptist University, Kowloon Tong, Hong Kong. Tel.: (852) 2339 7529, Fax: (852) 2339 5586, Email:
[email protected].
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An Empirical Investigation of the Ethical Beliefs of Consumers In China
Abstract
This study seeks to identify the ethical beliefs of consumers in China and the relationship of these beliefs with moral ideologies. Results indicate that the ethical dimensions of Chinese consumers are somewhat similar compared with consumers in the west. However, the dimension signified here as “Actively Benefiting at the Expense of Others” is unique among the Chinese consumers. In addition, those identified as idealists and those in higher income groups are more critical of ethically questionable behavior. Discussion and conclusions are offered.
Introduction
China has been undergoing rapid changes since the adoption of its open door policy in 1979, with a shift from a planned economy towards a market economy. China is described by Whitcomb, Erdener and Li (1998) as a country in which the process of institutional transformation has left cultural values in a state of flux. It has been argued that an examination of ethical decision making in China is significant due to the fact that the philosophical foundations of the Chinese culture differ substantially from Western philosophical traditions and that China’s rapid economic growth and increased involvement in international trade make understanding the Chinese perspectives as relevant to business ethics more important than before (Whitcomb et al., 1998).
In the recent decade, there has been increased awareness of unethical consumer practices in Asian countries, such as the production and purchase of counterfeit products (Chan, Wong and Leung, 1998). It has been reported that the largest portion of counterfeit products, from cosmetics, food, drugs, pesticides, and electrical appliances to the more publicized software, music and films, seized by customs
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authorities in the U.S. and Europe emanates from China (Simone, 1999).
Such
unethical practices have hurt trade and have led to substantial financial losses among a considerable number of multinational companies. For example, the estimated losses to U.S. software companies due to Chinese counterfeiting stood at US $322 million in 1993 (Kohut, 1994). Despite such staggering outcomes, research on consumer ethics in China is scarce. Studies on business ethics in China have in the past mainly focused on business values (Whitcomb et al., 1998) or business relationships (Steidlmeier, 1999; Wong and Chan, 1999). Chan et al. (1998) conducted a study on the ethical beliefs of Chinese consumers but they used Hong Kong students as their respondents. A study of the moral ideologies and ethical beliefs among consumers in China is therefore needed. The present study attempts to fill the gap by identifying the ethical beliefs of consumers in China and examining the relationship between their moral ideologies and ethical beliefs.
Implications of the results are offered to
marketers and policy makers.
Literature Review and Hypothesis Development
Consumer ethics is defined by Muncy and Vitell (1992) as “the moral principles and standards that guide behavior of individuals or groups as they obtain and dispose of goods and services”. Although ethics in the marketing exchange process has been the focus of past research, the notion of consumer ethics did not receive much attention until the establishment of the consumer ethics scale by Muncy and Vitell (1992).
Previous studies on consumer ethics mainly focused on specific types of questionable consumer behavior such as shoplifting and retail fraud (Cole, 1989; Cox, Cox and Moschis, 1990; Kallis, Krentier and Vanier, 1986; Moschis and Powell, 1986) or on specific types of behavior that are related to social concerns such as pollution and energy consumption (Antil, 1984). Other academics have attempted to suggest ways to decrease unethical consumer behavior (Schubert, 1979; Stampfl, 1979). Extending the work of Davis (1979) and Wilkes (1978), Muncy and Vitell (1992) developed a multi-dimensional consumer ethics scale.
Different from previous studies on
consumer ethics, their contribution lies in the fact that the measurement scale covers ethical behaviors in a broad variety of situations. Basically, findings from their work 4
suggest that consumers use three major rules to make their ethical judgments: the locus of the fault, the legality of the behavior, and the degree of harm caused (Vitell, Lumpkin and Rawwas, 1991). For example, actions that did not cause any harm to the sellers were considered as ethical, and actions that were illegal or initiated by the consumer were considered as unethical (Chan et. al., 1998). The scale has been widely utilized in various international settings such as Austria (Rawwas, 1996), Ireland and Lebanon (Rawwas, Patzer and Vitell, 1998) as well as Hong Kong (Chan et al., 1998). In a study conducted by Vitell et al. (1991), who examined elderly consumers’ perceptions of twenty consumer situations possible requiring
ethical
evaluations using the consumer ethics scale, they found that the vast majority of respondents were relatively sensitive to ethical issues. However, the subjects differed in terms of ethical beliefs and practiced a variety of ethical ideologies.
In terms of ethical ideologies, Forsyth (1980, 1992) developed a classification system based upon one’s preferred ethical ideology and contends that individuals form ethical or ‘moral’ judgments through two evaluative dimensions: idealism and relativism. Idealism refers to the degree to which an individual considers the welfare of others in evaluating the outcomes of alternative courses of action. Boyle (2000) explained that those with high ideals believe the most attractive alternative is the one that minimizes harm to others and those with low ideals may put more emphasis on the overall value of the outcome, even if it means that others may be harmed. Relativism refers to the emphasis placed on situational conditions surrounding an ethical dilemma versus universal standards of conduct. Those high on relativism view every situation as a special circumstance that is used as primary basis for forming ethical judgment. Those low on relativism apply a standard moral code across situations.
The
assumption of this classification system is that individuals can range from high to low in their emphasis on principles and in their emphasis on consequences.
In a study of the impact of customer characteristics and moral philosophies on ethical judgments of salespeople, Boyle (2000) found that the subjects’ level of relativism had a direct effect on their ethical judgments but their level of idealism did not. He argued that those high on relativism placed emphasis on situational factors when judging ethical dilemmas and therefore they would be less critical than those low on relativism of the questionable behavior.. In terms of the dimension of idealism, those 5
with high ideals judge the “ethicalness” of an act with regard to the amount of harm done to others. However, the scenario Boyle used did not specify positive or negative outcomes of the salespeople’s behavior.
He argued that idealism as an ethical
barometer was not useful in his study. Based on the above discussion, we hypothesize that, in the present study, consumers high on idealism and low on relativism are more critical of ethically questionable actions than those low on idealism and high on relativism. In other words,
H1:
Consumers who are high idealists (Part a) or low relativists (Part b) will be more critical of ethically questionable behaviors as compared with low idealists and high relativists, respectively.
The relationship between consumers’ demographic characteristics and ethical judgments has been widely researched and the results suggest diverging conclusions. In some previous studies, findings showed that females were more ethical than males (Arlow, 1991; Boyle, 2000; Malinowski and Berger, 1996; Shepard and Hartenian, 1990). However, in other studies, no significant relationship between ethical behavior and gender was indicated (Fritzshe, 1988; Singhapakdi and Vitell, 1990). It has been asserted that women are, in general, more ‘ethically sensitive’ than men (Boyle, 2000; Chonko and Hunt, 1985) due to the fact that they have a higher level of cognitive moral development. We argue here that female consumers will be more critical than male consumers of ethically questionable behaviors. Our formal hypothesis is stated as follows:
H2:
Female consumers will be more critical than male consumers of ethically questionable behaviors.
In previous studies, income and education were found to have correlations with ethical behavior (Boyle, 2000; Muncy and Vitell, 1992). Findings in the study by Muncy and Vitell (1992) showed that individuals with lower incomes and less education had greater ethical concerns regarding ethically questionable behaviors. It seems to be contradictory to the common understanding that education helps to develop a clearer understanding of fair behavior. Muncy and Vitell argued that this outcome was related to the notion of social class and that those in higher social 6
classes would show less ethical concern than those in lower social classes. Since their research is within the content of discovery, further research is warranted. Based on the literature, we hypothesize that:
H3:
Consumers with lower levels of income (Part a) and less education (Part b) will be more critical of ethically questionable behaviors.
Methodology
Measures
The questionnaire used to study our hypotheses was composed of the consumer ethics scale (CES), the Ethics Position Questionnaire (EPQ) and some questions on demographic information. The CES developed by Muncy and Vitell (1992) uses four dimensions to measure consumer ethics. The first dimension is called ‘Actively Benefiting from Illegal Activity’.
The actions identified in this dimension are
generally regarded as illegal and initiated by the consumer. The second dimension of ‘Passively Benefiting at the Expense of Others’ describes a consumer’s behavior when the consumer takes advantage of the seller’s mistake. The third dimension of ‘Actively Benefiting from a Questionable Action’ means that the consumer is actively involved in an action that may not be necessarily perceived as illegal. The fourth dimension of ‘No Harm/No Foul’ means that the consumer perceives that the consequences of his/her actions produce little or no harm and, in this way, they are considered permissible. This scale has acceptable levels of reliability in a number of studies (Muncy and Vitell, 1992; Rallapalli et al., 1994; Rawwas, Vitell and AlKhatib, 1994). Respondents were asked to choose from ‘strongly believe that the statement is wrong’ to ‘strongly believe that the statement is not wrong’ using a fivepoint Likert scale. When the scale was used in a study in the context of Hong Kong, Chan et al. (1998) adopted eighteen items from the scale since the rest of the questions had little bearing on local market conditions. Two new items were added that were ‘find a lost stored value ticket and use up the balance’ and ‘buying counterfeit compact disks instead of the real thing'’. After discussing the items with a group of residents in Shanghai, we decided to adopt eighteen items from the scale. 7
Compared with the statements used by Chan et al. (1998), our item choices were somewhat different.
In the present study, we included the statement ‘observing
someone shoplifting and ignoring it’ but deleted the statement ‘stretching the truth on an income tax return’. The two items added by Chan et al. (1998) were relevant to the culture in China and were therefore retained in the scale. A new item ‘buying and using counterfeit computer software’ was also added.
The predominant ethical ideology of the consumers was measured through the twenty-item EPQ developed by Forsyth (1992). Forseyth’s questionnaire consists of two scales, idealism with ten items and relativism with nine items.
The item
“Different types of moralities cannot be compared as to ‘rightness’” was deleted since most of our interviewees were unable to understand the meaning of the statement in the pre-test. Respondents were asked to indicate their agreement or disagreement with each item using a five-point Likert scale. Demographic information, such as gender, age, education and monthly family income, about the respondents was also collected. Information gathered from this section of the survey was used to examine the degree of impact of demographic characteristics on ethical judgments.
Following back translation procedures (Brislin, 1986), all items were first translated into Chinese and then back translated into English by two bilingual individuals. A Mainland Chinese professional researcher was invited to comment on the wording of the Chinese version.
This ensured that idiomatic or colloquial wording was
minimized (Douglas and Craig, 1983; Parameswaran and Yaprak, 1987).
Sampling frame and sampling procedures
Data were collected through judgmental sampling in Shanghai, China. Shanghai was chosen as a case study since it has been widely acknowledged as one of the leading cities in China. Its gross domestic product (GDP) increased from 290.2 billion yuan in 1996 to 403.5 billion yuan in 1999. The household consumption per year was 10328 yuan in 1999, which exceeded that in Beijing by 78.5% and in Guangdong by 117%. During the data collection process, trained interviewers intercepted consumers in major shopping centers in the central business districts of Shanghai. These districts ranged from lower- to middle-class districts and middle- to upper-class districts. It 8
has been argued that shopping mall customers constitute a major share of the market and, therefore, generally comprise an adequate sampling universe (Tull and Hawkins, 1993). We attempted to have fairly even distribution of respondents in terms of gender, age and income (see Table 1). In total, 323 questionnaires were collected and were usable for the study.
Statistical methods
Exploratory factor analysis with varimax rotation was first used to determine the dimensions of the consumer ethics scale in the Chinese case. Item-factor correlations (i.e., factor loadings) and other indices of model adequacy were also examined. The reliabilities of the CES and identified factors were then assessed by coefficient alphas. Finally, the hypotheses were tested through multivariate analysis of variance (MANOVA). This method was used to establish the statistical significance of group differences across full profiles of predictor variables. After assessing the overall group differences, further analysis to determine the source of these group differences was conducted with post-hoc tests (Scheffe’s test) to identify which pair of groups had significant differences. As suggested by Hair et al. (1995), Scheffe’s test is the most conservative with respect to Type I errors.
Analysis
Sample profile
The demographic data on the subjects are presented in Table 1. More than half of the respondents (54%) were younger than 30 years old.
Females made up a slight
majority of the sample (55%). Most of the participants were employed as technicians (22%), middle managers (22%) or general clerks (16%). Their monthly incomes and education levels were fairly well distributed. One-third of the respondents (34%) earned 3000 to 4999 yuan per month, while 30 percent of them had attained university or above education.
[Please insert Table 1 about here] 9
Scale assessment
To identify the dimensionality of the consumer ethics scale (CES), exploratory factor analysis was performed. The Chinese sample was suitable for factor generation since Bartlett’s test of Sphericity was significant at the 0.01 level (Chi-square = 3702.537, df = 210, p = 0.000). Moreover, the Kaisar-Meyer-Olkin Measure of Sampling Adequacy was 0.868, which indicated a desirable pattern of correlations and a desirable degree of intercorrelations among the variables. In this 21-item scale, five factors were extracted with 65.849 percent total variance explained.
These five
factors were “Actively Benefiting at the Expense of Others”, “Actively Benefiting from an Illegal Activity”, “Passively Benefiting at the Expense of Others”, “Questionable Action” and “No Harm/No Foul”. In addition, the reliability test indicated that the psychometric properties of the entire scale and five constructs were reliable. On the whole, the coefficient alpha of the CES was 0.89. The alphas of the five dimensions in the CES scale as noted above were 0.89, 0.85, 0.86, 0.67, 0.60, respectively, indicating consistent scores in the sample.
[Please insert Table 2 about here]
The second scale, the ethics position questionnaire (EPQ), included two constructs, namely, idealism and relativism.
These two dimensions were also subjected to
reliability tests. The coefficient alphas of idealism and relativism were, respectively, 0.80 and 0.75. They were stable in the Chinese sample.
[Please insert Table 3 about here]
In order to test H1, idealism and relativism were both divided into two groups via the median split method. For idealism, 162 of the respondents were identified as low, while the remaining 161 were high. On the other hand, 172 were low on relativism while 151 of them were high on relativism.
MANOVA analysis
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Multivariate analysis of variance (MANOVA) was selected to uncover group differences across multiple variables in the consumer ethics scale.
Before
investigating the MANOVA model, tests of the homogeneity of variance and of the correlation among the dependent variables were conducted. As shown in Table 4, most of the variables had nonsignificant results in Box’s M multivariate test and Levene univariate test. This meant that the variances between the groups were the same. Therefore, the homogeneity of variance in this sample was guaranteed. In addition, as shown in Table 5, Bartlett’s test of Sphericity indicated that all dependent variables had a significance level of 0.001 with each independent variable. The necessary level of intercorrelation among dependent variables was satisfied, justifying the use of MANOVA in this study.
[Please insert Table 4 & Table 5 about here]
Provided that the assumptions of MANOVA were met, the assessment of significant differences among the groups formed by the treatments could proceed. Table 6 includes results from the univariate F tests, Wilks’s estimate, the effect size and the observed power. First of all, the F value provided results on the overall differences among dependent variables for each independent variable. Relativism and gender had no difference at the 0.05 significance level, indicating that both male and female Chinese consumers with different perspectives on relativism have the same attitude towards the ethically questionable behaviors. Hypothesis 1 (Part 2) and Hypothesis 2 were therefore not supported by the results of the analysis.
On the other hand, Table 6 shows that the mean vectors of three other independent variables (i.e., idealism, income level and education level) were unequal. All group means among the five ethical constructs varied across idealism (F = 6.82; p = 0.000), income level (F = 5.24; p = 0.000) and education level (F = 2.96; p = 0.000). This meant that univariate analysis of specific differences between groups was appropriate, so post-hoc tests (i.e., Scheffe’s test) were conducted.
[Please insert Table 6 about here]
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Scheffe’s contrasts were conducted to differentiate mean levels between identifiable groups. A smaller mean score signals higher degree of criticism towards the ethically questionable statements. Table 7 presents the mean scores for each independent category.
Idealism differentiates four out of five consumer ethical dimensions. High idealists had lower mean scores in factor 2 (mean = 1.53), factor 3 (2.43), factor 4 (2.07) and factor 5 (3.16) than did low idealists (mean of factor 2 = 1.90; factor 3 = 2.76; factor 4 = 2.34; factor 5 = 3.52). These results indicate that high idealists did not accept the ethically questionable behaviors compared with low idealists. Thus, H1 (Part 1) was supported by the analysis results.
For income level, those in higher income group (earning 5000 yuan or above per month) scored significantly lower in factor 2 (1.47), factor 3 (2.38), factor 4 (2.20) and factor 5 (3.23) than did those in the lower income group (earning less than 3000 yuan per month) (factor 2 = 2.01; factor 3 = 2.97; factor 4 = 2.40; factor 5 = 3.59). The medium-level income group (monthly income of 3000 to 4999 yuan) was always rated between the higher and lower income groups. From these results, it is clear that consumers with higher incomes were more critical than those with lower incomes of questionable ethical practices. Therefore, H3 (Part a) is not supported by the data from this Chinese sample.
Lastly, education level has impacts on four consumer ethical constructs. People having secondary or below education levels were less critical of questionable ethical situations (factor 2 = 2.06; factor 3 = 2.88; factor 4 = 2.44; factor 5 = 3.64) than those with higher education levels.
Consumers with higher education levels actually
demonstrated mixed results on different ethical dimensions. For example, those with college education scored the lowest in factor 2 (1.58), factor 4 (2.09) and factor 5 (3.22), but those with university or above education rated the lowest in factor 3 (2.39). These results indicated that Chinese people with college education were less likely to support questionable ethical situations such as the dimensions of “Actively Benefiting from Illegal Activities”, “Questionable Actions” and “No Harm/No Foul”. Thus, H3 (Part b) is not supported by the results of the analysis.
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[Please insert Table 7 about here]
Discussion and Conclusions
Despite cultural differences between China and the west, similar attitudes towards ethically questionable behavior are found in China. The five factors of the CES are “Actively Benefiting at the Expense of Others”, “Actively Benefiting from an Illegal Activity”, “Passively Benefiting at the Expense of Others”, “Questionable Action” and “No Harm/No Foul”. The psychometric properties of these five dimensions are stable as compared with past studies. As shown in Table 8, the coefficient alphas of the present study are higher in the dimensions of “Actively Benefiting from an Illegal Activity”, “Passively Benefiting at the Expense of Others” and “Questionable Action” compared with studies in Austria (Rawwas, 1996), Ireland and Lebanon (Rawwas et al., 1998) and Hong Kong (Chan et al., 1998). The reliability level of the factor of “No Harm/No Foul” is also close to the studies conducted in the west. We conclude that most of the items in the CES are appropriate to be applied to the Chinese setting. Nevertheless, some of the items are not identical in the Chinese case. In the Shanghai sample, one construct called “Actively Benefiting at the Expense of Others” was identified.
[Please insert Table 8 about here]
In Table 9, the rankings and group means of the present study are compared with two previous studies by Chan et al. (1998) who studied consumers in Hong Kong case and Muncy and Vitell (1992) who used U.S. consumers in their study. By measuring the Kendall Coefficient of Concordance W, the rankings of the dimensions were determined. The computed W was 0.444 (p > 0.05), which indicates that there was moderate agreement in the ethical behavior across the three consumer ethics studies. The large significance level showed that none of the constructs was different from the others.
Such a result agrees with the above comparison of the psychometric
properties. In particular, the four major constructs of the CES and their rankings are confirmed in both western and eastern countries. The only disagreement in the scale
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is that of “Actively Benefiting at the Expense of Others”, which is identified as significant in the current study.
[Please insert Table 9 about here]
Based on the above two analyses, “Actively Benefiting at the Expense of Others” is unique in China. According to the mean scores of the five items in the dimension, it seems that Chinese consumers do not see buying counterfeit products and software as an unethical behavior. This may be due to the underlying attitude in China towards the protection of intellectual property. On the one hand, it is a tradition for the Chinese to protect their own invented products using their own methods, such as disclosing “secrets” only to their family members. They are somewhat unaware of any laws related to intellectual property. On the other hand, the ordinance for intellectual property is not yet well established and effectively implemented (Leung, Tse, Williams, Zhong and Davies, 2001; Weeks, 2000). It is still common to find pirated software programs across various industries under the current regulatory framework (Yeh, 1999).
Clearly, it is imperative for the government and the education
authorities to educate consumers on the importance of protecting intellectual property and to punish any infringements harshly. In the long run, consumer education aimed at developing correct ethical norms and peer pressure is crucial (Chan et al., 1998). We expect that the enforcement of intellectual property regulations will be improved after China joins the World Trade Organization (Clark, 2000).
This study has successfully determined the differences in ethical attitudes among different groups of people. It shows that high idealists are more critical of ethically questionable behavior. This result is in contrast with past studies in western countries (Boyle, 2000). In particular, after evaluating the mean scores, it is found that high idealists are opposed to any action that allows a consumer to actively benefit from illegal activities. With reference to previous studies of cross-cultural ethical beliefs, Asian people were perceived to be more idealistic than non-Asians (Al-Khatib, Dobie and Vitell, 1995; Lee and Sirgy, 1999). Idealistic consumers are not likely to engage in unethical behaviors. The presence of such idealists in China can be explained by the notion of social desirability and Chinese cultural values. Nyaw and Ng (1994) discovered that people with a stronger social desirability bias are more likely to 14
respond in an ethical manner in an ethically questionable situation. Eastern people are characterized by their social desirability (Middleton and Jones, 2000). Middleton and Jones’s (2000) study concluded that eastern consumers are more likely to deny socially undesirable traits and to admit to socially desirable ones than were western consumers. Therefore, it is logical to believe that Chinese idealists are more critical of ethically questionable issues.
Another reason for Chinese idealists to have negative attitudes towards unethical activities is the underlying Chinese cultural values.
Chinese people are group
oriented and face-saving (Hofstede, 1984, 1991; Huo and Randall, 1991; Krone, Chen and Xia, 1997; Robinson, 1996). In eastern societies, collectivists are presumed to put the interests of their group before their own interests. Therefore, their responses might display great loyalty to their group.
As a result, they may behave more
ethically in order to protect the interests of the entire group. In order to save face, Chinese avoid any public embarrassment and criticism by minimizing or covering up obvious mistakes (Osland, 1990; Yao, 1987). Such mistakes may include unethical social conduct. Consequently, they have a strong tendency to observe strict ethical standards in public (Chan et al., 1998).
When comparing the results presented here with those of past studies, the present study indicates no significant relationship between gender and ethical attitudes. This is consistent with some previous results (Fritzshe, 1988; Singhapakdi and Vitell, 1990). However, there is a reverse relationship regarding consumers with different income levels and education levels in China. Chinese consumers in the higher income group are less acceptable of ethically questionable actions. As shown in the mean scores, the higher income group believes that it is wrong to gain benefit from illegal activities.
Also, those with less education are more prone to accept ethically
questionable behaviors compared with those with more education, especially in regards to those activities that allow consumers to passively benefit at the expense of others and to cause no harm to others. These results are inconsistent with previous studies (Muncy and Vitell, 1992). In China, people in the higher social classes show more ethical concern than those in lower social classes. This is partly explained by the emergence and development of business ethics within tertiary institutions in the context of the economic reforms. 15
Since 1979, the Department of Education in China mandated that ethics be taught as a formal course by the department of philosophy at universities. In the 1980’s, the economic reforms expanded from a planned economy to a planned commodity economy. The discussions on business and ethics therefore moved to an issue-oriented approach, covering such topics as commodity and moral development, ethics and modernization, material civilization and spiritual civilization (Lu, 1997). In 1994, the reforms entered the stage of establishing a socialist market economy.
Not only
economists, philosophers, and entrepreneurs but also lawyers and media people participated in discussions of numerous laws and rules that are related to economic and business activities, such as the quality of products and the pollution of the environment. Numerous courses on business ethics for graduate and undergraduate students were offered by the universities in the leading cities, such as Beijing and Shanghai. Most students attending universities were given ample opportunities to expose themselves to ethics or business ethics through one way or another. This could partly explain the fact that people in the higher social class are more sensitive and show more ethical concerns than those in lower social class.
The study was conducted within the content of discovery. Nevertheless, it advances our understanding of Chinese consumer ethics. Due to the cultural diversity within China, further research should look at issues such as the extent to which ethical beliefs differ across regions.
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Table 1: Sample Characteristics Characteristics
Frequency
Percentage
Age
Below 20 20 – 29 30 – 39 40 – 49 50 – 59 60 or above
11 164 75 38 20 15
3% 51% 23% 12% 6% 5%
Gender
Male Female
144 179
45% 55%
Occupation
Housewife Student Unemployed Self-employed Technician General Clerk Middle Manager Upper Manager Profession Other
20 29 15 12 70 52 70 18 13 24
6% 9% 5% 4% 22% 16% 22% 6% 4% 7%
Monthly Income
Below 3000 yuan 3000-4999 yuan 5000 yuan or above
86 110 127
27% 34% 39%
Education Level
Secondary or below College Vocational Training University or above
73 88 63 99
23% 27% 20% 30%
Sample Size: 323
22
Table 2: Consumer Ethics Scale (CES) Mean Factor 1 Actively Benefiting at the Expense of Others 1. Buying counterfeit CD or VCD. 2. Buying and using counterfeit computer software. 3. Recording a musical CD instead of buying it. 4. Taping a movie off the television. 5. Using computer software or games that you did not buy. Factor 2 Actively Benefiting from an Illegal Activity 6. Changing price-tags on merchandise in a store. 7. Drinking a can of soda in a supermarket without paying for it. 8. Giving misleading price information to a clerk for unpriced item. 9. Reporting a lost item as stolen to an insurance company in order to collect the money. 10. Returning damaged merchandise when the damage is your own fault. 11. Lying about a child’s age in order to get a lower price.
3.46 3.45 3.75 3.62 3.78
0.85 1.51 1.52
0.87 0.84
1.58
0.78
1.78
0.63
1.97
0.58
1.95
0.47
Factor 3 Passively Benefiting at the Expense of Others 12. Not saying anything when the waitress miscalculates 2.52 the bill in your favor. 13. Getting too much change and not saying anything. 2.56 14. Moving into a new residence, finding the cable TV is 2.71 still hooked up, and using it rather than signing up and paying for it. Factor 4 Questionable Action 15. Observing someone shoplifting and ignoring it. 16. Breaking a bottle of salad dressing in a supermarket and doing nothing about it. 17. Taking an ashtray or other “souvenir” from a hotel or restaurant. 18. Finding a lost stored value ticket and using up the balance.
Factor Alpha Loading 0.89 0.85 0.81 0.77 0.77 0.73
0.86 0.82 0.81 0.56
0.67 2.22 1.99
0.78 0.66
2.36
0.54
2.25
0.50
Factor 5 No Harm/No Foul 19. Spending over an hour trying on different dresses and 3.39 not purchasing any. 20. Returning merchandise after trying it and not liking it. 3.58 21. Returning an item after finding out that the same item 3.06 is now on sale. Note: 1-completely wrong … 3-neutural … 5-completely correct
0.60 0.76 0.71 0.58
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Table 3: Ethical Position Questionnaire (EPQ) Mean Idealism 1. A person should make certain that their actions never intentionally harm another even to small degree 2. Risks to another should never be tolerated, irrespective of how small the risks might be. 3. The existence of potential harm to others is always wrong, irrespective of the benefits to be gained 4. One should never psychologically or physically harm another person. 5. One should not perform an action which might in any way threaten the dignity and welfare of another individual. 6. If an action could harm an innocent person, it should not be done. 7. Deciding whether or not to perform an act by balancing the positive consequences against the negative consequences is immoral. 8. The dignity and welfare of people should be the most important concern in any society. 9. It is never necessary to sacrifice the welfare of others. 10. Moral actions are those which closely match ideals of the most “perfect” action. Relativism 1. There are no ethical principles so important that they should be a part of an ethical code. 2. What is ethical varies from one situation to another. 3. Moral standards are individualistic; what one person considers to be moral may seem immoral to another. 4. What is ethical for everyone can never be resolved since what is moral or immoral is up to the individual. 5. Moral standards are simply personal rules which indicate how a person should behave, and are not to be applied in making judgments of others. 6. Ethical considerations in interpersonal relations are so complex that individuals should be allowed to formulate their own individual codes. 7. Rigidly codifying an ethical position that prevents certain types of actions stand in the way of better human relations and adjustment. 8. No rule concerning lying can be formulated; whether a lie is permissible or not totally depends upon the situation. 9. Whether a lie is judged to be moral or immoral depends upon the circumstances surrounding the action.
Alpha 0.80
3.45 3.12 3.35 3.29 3.70 3.83 2.48
3.66 3.09 3.51
0.75 3.44 3.87 3.69 3.64 3.44
3.85
3.14
3.80 3.89
Note: 1-strongly disagree … 3-neutural … 5-strongly agree
24
Table 4: MANOVA Test of Assumptions: Homogeneity of Variance Factor 1 Factor 2 Factor 3 Factor 4 Factor 5 Overall Idealism
Relativism
Gender
Income
Education
Univariate Levenue Test Multivate Box’s M
2.79 0.35 1.46 0.02 4.76 (0.095) (0.556) (0.229) (0.895) (0.030)
Univariate Levenue Test Multivate Box’s M
3.74 3.96 12.24 0.57 2.05 (0.054) (0.048) (0.001) (0.451) (0.153)
Univariate Levenue Test Multivate Box’s M
1.75 0.11 0.05 0.10 0.05 (0.187) (0.737) (0.832) (0.752) (0.829)
Univariate Levenue Test Multivate Box’s M
2.15 13.55 1.56 2.56 1.23 (0.118) (0.000) (0.211) (0.079) (0.294)
Univariate Levenue Test Multivate Box’s M
1.37 2.34 1.30 0.76 0.35 (0.252) (0.074) (0.273) (0.519) (0.790)
14.36 (0.516)
29.63 (0.015)
6.28 (0.977)
103.97 (0.000)
95.27 (0.000)
25
Table 5: MANOVA Test of Assumptions: Correlation of Dependent Variables Independent Variables
Bartlett Test of Sphericity Chi-square
Sig.
Idealism
500.35
0.000
Relativism
526.06
0.000
Gender
523.41
0.000
Income Level
497.34
0.000
Education Level
506.53
0.000
26
Table 6: MANOVA Results and Univariate F Tests Factor1 Factor2 Factor3 Factor4 Factor5 Wilks’s F Effect Observed Size Power Idealism
1.68 25.64 9.16 10.74 16.18 (0.196) (0.000) (0.003) (0.001) (0.000)
6.82 (0.000)
0.09
0.99
Relativism 1.22 0.33 0.00 2.78 0.05 (0.270) (0.564) (0.996) (0.097) (0.816)
1.45 (0.207)
0.02
0.51
Gender
0.08 0.08 0.53 3.59 1.11 (0.776) (0.772) (0.469) (0.059) (0.292)
1.40 (0.223)
0.02
0.49
Income
1.49 18.56 9.69 6.58 5.89 (0.227) (0.000) (0.000) (0.002) (0.003)
5.24 (0.000)
0.08
1.00
Education
1.19 8.76 3.46 3.73 4.32 (0.314) (0.000) (0.017) (0.012) (0.005)
2.96 (0.000)
0.05
0.99
27
Table 7: Average Ethical Scores Factor1
Factor2
Factor3
Factor4
Factor5
Idealism Low High
3.67 3.55
1.90* 1.53*
2.76* 2.43*
2.34* 2.07*
3.52* 3.16*
Relativism Low High
3.56 3.67
1.74 1.69
2.59 2.59
2.27 2.13
3.33 3.35
Gender Male Female
3.63 3.59
1.73 1.71
2.64 2.56
2.28 2.12
3.29 3.39
Income Below 3000 3000 - 4999 5000 or above
3.72 3.51 3.62
2.01a b 1.78a c 1.47b c
2.97a b 2.56a 2.38b
2.40a 2.24 2.20a
3.59a b 3.27a 3.23b
Education Secondary or below College Vocational Training University or above
3.59 3.70 3.69 3.49
2.06a b c 1.58a 1.69b 1.61c
2.88a 2.57 2.63 2.39a
2.44a b 2.09a 2.22 2.11b
3.64a b 3.22a 3.25 3.34b
Note: 1. 1-strongly disagree … 3-neutural … 5-strongly agree 2. *: Significant at 0.05 level. 3. The same letters (a, b or c) indicate significant mean differences (p < 0.05) between the groups based on the Scheffe’s multiple comparison tests.
28
Table 8: Comparison of Psychometric Properties of Studies of Consumer Ethics Dimensions
Rawwas (1996) Austria
Rawwas et al. (1998) Lebanese
Irish
Chan et al. (1998)
The Present Study
Hong Kong
China
Items Alphas Items Alphas Items Alphas Items Alphas Items Alphas
Actively Benefiting from an Illegal Activity
3
0.65
4
0.63
4
0.78
3
0.75
6
0.85
Passively Benefiting at the Expense of Others
3
0.73
3
0.59
3
0.81
6
0.79
3
0.86
Questionable Action
2
0.55
3
0.62
4
0.55
4
0.51
4
0.67
No Harm/No Foul
7
0.66
7
0.76
3
0.64
4
0.63
3
0.60
N.A.
5
0.89
Actively Benefiting at the Expense of Others
N.A.
N.A.
N.A.
29
Table 9: Comparison of Studies of Consumer Ethics
Dimensions
This Study
Chan et al. (1998)
Muncy & Vitell (1992)
Chinese consumers
Hong Kong students
U.S. households
N = 323
N = 242
N = 569
Rank
Mean
Rank
Mean
Rank
Mean
Actively Benefiting at the Expense of Others
1
3.61
N.A.
N.A.
N.A.
N.A.
Actively Benefiting from an Illegal Activity
2
1.72
1
1.49
1
1.45
Passively Benefiting at the Expense of Others
3
2.60
2
2.45
2
1.99
Questionable Action
4
2.21
4
3.71
3
2.14
No Harm/No Foul
5
3.34
3
3.35
4
3.38
Kendall Coefficient of Concordance (W)
W = 0.44 p > 0.05
Note: 1-strongly disagree … 3-neutural … 5-strongly agree
30
