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Borland Case Study

! Did Kahn do anything wrong? Explain

! Was it the salesman’s responsibility to keepfrom being ‘bluffed’?

Albert Carr

“is Business Bluffing Ethical”

Nature of Bluffing

What is it to bluff in business?

For Carr, it's to engage in conscious misstatementsof facts, concealment of pertinent facts, and formsof exaggeration…”

Nature of Bluffing

Generally, for Carr, to bluff in business is toengage in some form of deception. These acts ofdeception are they not illegal, are widely practiced

and accepted within the business community.

Some Examples of Bluffing

! Deceptive Advertising

! Withholding Improved products

! Up-selling

! Deceptive Bargaining

! Misrepresenting oneself

Q: Why think acts like these, ones involvingdeception of some form, are morally permitted?

Deception normally isn't permitted. So anexplanation is needed.

Carr’s Poker Argument/Analogy

1. Bluffing in poker, though a form of deception in orderto get other players' money, is not against the rules ofpoker, and it is a widespread practice amongst pokerplayers.

2. Poker players know this (or at least should know this).

3. So, poker players expect (or should expect) to bebluffed from time to time. If you are bluffed out ofmoney, you can't attach blame to the one who did it. It'sup to you to keep from falling for it, and it’s not likeyou didn’t know this could happen.

4. So it's permissible to bluff while playing poker

Carr’s Poker Argument/Analogy

5. Business is very similar to poker

6. Bluffing in business, though a form of deception is notagainst the law and is widely practiced within the contextof business.

7. 'Players' in the game of business know this (or at leastshould know this).

8. So, 'players' in the game of business expect (or shouldexpect) to be bluffed from time to time. If you are bluffedin some way, you can't attach blame to the one who did it.It's up to you to keep from falling for it, and it's not likeyou didn't know this could happen.

9. So it's permissible to bluff in business.

Evaluation

Does the conclusion that bluffing in business ispermissible really follow? Carr seemingly thinksthat what makes bluffing permissible is the factthat it's commonly practiced, not illegal, and thatthe 'players' involved know all this and thereforeexpect that one will try and bluff them in someform or other.

But what if car vandalism in San Francisco is notillegal, rampant, and all car owners (even visitors)know they risk being vandalized. Is vandalismsomehow made to be permissible?

Evaluation

The point is that perhaps legality and widespreadacceptance and participation are not sufficient toestablish moral permissibility.

This doesn’t show that bluffing is in factimpermissible. It suggests that it hasn’t beenshown that it is permissible.

Evaluation

Another point:

There are some cases of bluffing that Carr wouldseemingly say are justified, and yet it's not clearhow some of the 'players' would know (or beexpected to know) that someone could try andbluff them (e.g. insurance companies and theoutdated actuarial tables). How is it that thecustomers should have known that their insuranceagents might try to deceive them? It's not clearthat they should have known. Many people trustthat insurance agents have the customers' bestinterest in mind, and not their own.

Evaluation:

Perhaps Carr would say that even if we can'thonestly say to the customer "you should haveknown that you might be deceived", the acts inquestion (the concealment of the fact that thetables were outdated and overcharging themaccordingly) were still not illegal. Thus the actswere fully permissible.

Q: Is this a good reply?

Thomas Carson

“Second Thoughts About Bluffing”

Carson’s main line of thought can be seen as aresponse to the following argument:

An argument against bluffing

1. To lie, on the traditional conception of lying, isto utter "a false statement with the intent todeceive".

2. To bluff with respect to one's bargainingposition, is to utter "a false statement with theintent to deceive".

3. To lie is to do something wrong.

4. So, to bluff with respect to one's bargainingposition, is to do something wrong.

An argument against bluffing

More on premise 1 (the traditional conception oflying):

I lie only if:

a). I utter a statement I believe to be false.

[If I merely utter a false statement I sincerelybelieve to be true (e.g. "Project Runway is onBravo"), then that doesn't constitute lying].

And,

An argument against bluffing

b.) The statement I believe to be false is meant todeceive someone else.

(Say I utter a statement "it's a billion degreesoutside". I believe this to be false. But it's not atall clear that I'm trying to deceive someone by thisstatement. For in normal cases, I know myaudience will not believe such an outlandishstatement. So my statement is not a lie).

An argument against bluffing

More on premise 2.

The type of bluffing Carson is interested in doesseem to constitute lying. For example, a sellersays that she "will sell the house for as low as 85Kbut no lower". She knows this false; she iscontent in selling it for 80K.

An argument against bluffing

Moreover, this statement is meant to deceive thebuyer (the seller is hoping the buyer will believeher and pay 85K. This is obviously to heradvantage in that she’ll get 5K more than whatshe's perfectly happy to receive). It's not asthough she said that she will sell the house for aslow as $2.5 billion, or $5 or something.

So it would seem that bluffing in this way iswrong.

Carson’s reply

On second thought, maybe the traditional conceptof lying is not quite correct

Carson’s conception of lying:

A speaker lies when she intentionally utters astatement she does not believe to be true in acontext where it is assumed/expected by othersthat what she is saying is indeed true. That is, in acontext where ‘attached’ to her words is animplicit promise or guarantee that what she issaying is true.

Carson’s conception of lying:

In some contexts, say between hardenednegotiators, statements are uttered that are notbelieved to be true, but it's not the case that othersinvolved assume/expect that what is said is indeedtrue. Negotiators know and have consented to thefact that, at least when it comes to bargainingpositions, they are not making an implicit promiseor guarantee that what they are saying is true. Sothey are not lying, at least when it comes to statingbargaining positions.

Carson v. Carr

Here’s one possible way of seeing the differencebetween the two:

Carson would seemingly say that Carr has tried tojustify bluffing (i.e. lying) by saying that it iswidely practiced, not against the law, and thoseinvolved expect to be lied to, etc. But, saysCarson, something that is normally thought to bewrong can't be shown to be right just because ofthese things. On the other hand, says Carson, I'veshown that bluffing is not lying at all.