Honesty in intra-organizational reporting

In this experimental study we analyze the trade-off between the subjects’ preference for wealth on the one hand and their preference for honesty on the other hand. The purpose of this research is to examine the effect of communication medium on reporting behavior. We want to know whether situational cues, such as the communication method—digital (via computer) vs. hard-copy (via paper and pencil) matter, while considering deception. Furthermore, we are interested in the relationship between the social value orientation (SVO) and the reporting behavior. While the experimental evidence shows that participants in both treatments have a preference for truthful reporting and they avoid major lies, there are also remarkable differences between the treatments which we attribute to the reporting medium: computer treatment CT versus paper-and-pencil treatment PPT. Agents are willing to report more honestly via a hard-copy medium than via a digital medium. It seems like participants perceive the digital report more confidential and anonymous than the hard-copy report, and that is why they tend to misrepresent in the CT rather than in the PPT. Further, we found that the SVO influences reporting behavior.