Work

Whistleblowing: incentives and situational determinants

Year: 2025

Type: article

Abstract: Law makers increasingly try to capitalize on individuals having acquired knowledge of corporate crimes or other misconduct by inducing them to blow the whistle. In a laboratory experiment we measure the effectiveness of incentives on the willingness to report such misconduct to a sanctioning authority. We find that fines for non-reporting insiders, rewards, and even simple commands, increase the probability of whistleblowing. We find the strongest effect for fines. Situational determinants also influence the willingness to blow the whistle: Insiders who are negatively affected by the misconduct are more likely to blow the whistle than non-affected or profiting insiders. Those (negatively affected) victims are also sensitive to the misconduct’s impact on the authority sanctioning the misconduct (public authority or employer): Whistleblowing is more likely if the enforcement authority is negatively affected compared to positively or not affected.

Source: Journal of Business Economics

DOI: 10.1007/s11573-025-01223-0

Authors: Klaus Ulrich Schmolke, Verena Utikal

Institutions: Johannes Gutenberg University Mainz, Seeburg Castle University

Language: English

Topic: Ethics in Business and Education

Subfield: Information Systems and Management

Field: Decision Sciences

Domain: Social Sciences

SDG: Peace, justice, and strong institutions

Open Access status: hybrid

Estimated APC paid: $3,090