What is it about?
Based on the understanding that psychopaths are motivated to seek careers in which power, money, and control can be acquired, it was theorised that they would congregate in the financial services sector of economies and engage in risk-taking with other people's money (in the form of debt-based derivative products) to gain bonuses for themselves. This eventually resulted in the crisis of debt that resulted in the global financial crisis of 2008.
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Why is it important?
This is important because if psychopaths are actively involved in corporate and investment banking, they will always put their own interests before those of their clients and customers. Investment decisions will be sub-optimal from a corporate point of view and primarily geared towards generating paper profits and undeserved bonuses. Financial crises will then be a permanent feature of economies.
Perspectives
While some academics remain skeptical, the majority of financial insiders agree with this theoretical explanation. Indeed, they regard it as merely stating the obvious. The psychopathic are heavily involved in running our financial sectors.
Dr Clive Roland Boddy
Anglia Ruskin University
Read the Original
This page is a summary of: The Corporate Psychopaths Theory of the Global Financial Crisis, Journal of Business Ethics, February 2011, Springer Science + Business Media,
DOI: 10.1007/s10551-011-0810-4.
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