Research Grants

Research Grants

Apart from the Edmond J. Safra Center for Ethics annual Fellows Academic Program, its diversified research groups and international conferences, and further academic activities supported by the Center, the research of the intersection of ethics, law and markets is also encouraged by the Center by offering generous research grants, on a competitive basis, to senior faculty members at Tel Aviv University from all disciplines and fields.

The grants, offered for a period of one year (in some cases, extension for one additional year is possible), are intended to fund an original research project culminating in an academic publication (article or book). A grant can be used to employ research assistants and/or to finance other research expenses, but cannot be used to finance travel abroad, invite guests or organize conferences.

 

Please check here for the Call 2021-22 (in Hebrew)

 

Grant Winners 2020-21:

 

The Ethical Implications of Full-Time Employment Under Algorithmic Management: The Case of Bubble Dan


Dr. Lior Zalmanson, Coller School of Management, TAU

 

Our research focuses on the ethical implications and work-related consequences of algorithmic management in the case of Bubble Dan – a ride-hailing initiative. In the last decade, many firms have begun to employ multitudes of remote workers through the supervision and day-to-day control of algorithms that replace traditional middle-management roles.

In our case, the Bubble Dan transport at Tel Aviv incorporates machine-learning algorithms through a specialized app that is responsible for assigning riders to drivers and determines the vehicles' routes, including their stop sequence and the drivers' lunch breaks. However, as opposed to similar implementations by ride-hailing firms such as Uber and Lyft, in Bubble Dan's case, the workers are not “independent contractors” but instead officially employed by the company. As such, drivers experience interactions with both their direct human employer and the algorithmic management set in place to manage their day-to-day activities.

Our proposal focuses on understanding the ethical implications of such work conditions. In the proposed research, we seek to answer how drivers perceive the fairness and the work conditions created under the ride-hailing app and its algorithms. Moreover, we plan to focus on the roles of the human employer and its interactions with the drivers in addressing emerging ethical concerns. Last, we wish to test if perceptions of algorithmic unfairness affect employees' retention in the firm. The work will incorporate semi-structured in-depth interview, long-term field observations as well as online discourse analysis of correspondences between Bubble drivers. The research project aims to contribute in the field of AI in the workforce to both academics, managers and policy.

 

Getting Beneath the Veil of Intergenerational Mobility: Evidence from Three Cities


Dr. Oren Danieli with Tanaya Devi and Roland Fryer, School of Economics, TAU

We develop a data-driven way to design the optimal policy experiment for increasing chances of escaping poverty. We collected data from in-person surveys of almost 1,000 individuals who were reared in poverty in Memphis, Tulsa, and New Orleans, and asked about their childhood health, parental income, home environment as a child, childhood experiences, lifetime traumas, neighborhood safety, a host of psychological skills, beliefs, and current income. Using typical descriptive approaches to motivate an intervention implicitly assumes one can alter individual characteristics in any way the data deem predictive – e.g. sending youth to college who have been the victims of abuse – even if one rarely observes that combination of characteristics in the data. We replace this with four axioms about the expected cost of altering any combination of individual characteristics. Under these axioms, the optimal experiment replicates the way people escape poverty in real life. We develop a method to identify the variable that should be most affected in an intervention and test it in various simulations. We find that educational attainment is the most important determinant of mobility. Yet, many other variables – traditionally ignored by economists – are almost equally important predictors: resilience, Big 5 personality skills, grit, self-esteem, the number of adults trusted, trouble with the police when young, and other adverse childhood experiences. Fathers present in own neighborhood did not matter. This suggests that income-increasing interventions for the poor need to be broader than simply human capital or place-based policies. 

 

The question of moral worth in a controversial market: A case study of the sex industry


Prof. Einat Peled, with Dr. Ye'ela Lahav-Raz (Post-doctoral fellow) & Ayelet Prior (PhD candidate), The Bob Shapell School of Social Work, TAU

How do individuals conceptualize the moral worth of their involvement in highly-controversial markets? Which justification regimes do they use to discuss their involvement in questionable industries?

The investigation of pragmatic morality focuses on exploring the justification regimes individuals operate and how they define and discuss their moral worth (Dromi & Illouz, 2010). In the current age of neoliberalism, capitalism, and mass consumption, the sex industry serves as one of the most prominent examples for morally questionable economic sites, in which individuals trade their bodily and emotional attributes in multiple and continuously changing contexts. By focusing on sex industry's consumers and analyzing their accounts of moral worth in different and intersecting geographic locations and discursive settings, especially in times of changing legal status, this study will contribute to the theoretical conceptualization of pragmatic morality and justification regimes within highly morally-controversial markets.

 

Unbundling the Welfare State – an Experiment


Dr. Tamar Kricheli-Katz, Buchmann Faculty of Law, TAU, with Prof. Tsilly Dagan, Oxford & Bar-Ilan Universities

In this research we seek to explore the interaction of various “types” of states, the ability of (certain) individuals to choose among them and their ability to pick and choose public goods and services. We examine whether (and how) such capacity for choice affects people’s understanding of social justice, their levels of solidarity to their peers, and its possible effects on their productivity and risk taking. We further seek to inquire into how the dynamics of such markets may affect the nature and governance of different policy choices under global competition among states. We take an empirical approach to investigate the effects of various policy contexts.

 

Group-Based Economic Development Plans: Past, Present and Future


Dr. Ofra Bloch, Buchmann Faculty of Law, TAU

On December 30, 2015, the Israeli government adopted Resolution No. 922, “Economic Development Plan for the Arab Society (2016-2020)”—a five-year plan to invest 15 billion Shekels to promote the economic rehabilitation and integration of Palestinian-Arab citizens of Israel. This plan is often referred to as exceptional and unprecedented. However, drawing on archival research, this project shows that Resolution 922 was actually preceded by similar programs. Though understudied and undertheorized, periodical large-scale group-based economic development plans for the Arab population have deep roots in Israel’s early history. This project aims to start filling this gap by developing a better understanding of group-based economic development and integration plans. It seeks to explore the nature of this legal tool and its rationale.  It examines the conditions under which such plans were previously adopted and the obstacles for their successful implementation. Studying these policies over time could enhance our understanding of how they operate today in Israel and elsewhere.

 

 

 

 

Grant Winners 2019-20:

"To Thine Own Self be True!": The Path to Work Power through Authenticity and Morality


Daniel Heller

What leads to upward mobility in labor markets and makes people rise to power? Is being true to the inner-self an effective strategy to achieve and maintain power, or rather should the powerful disguise their true selves? Given the importance of upward mobility in labor markets, in this research we test whether authenticity–defined as the degree to which individuals connect with and act upon their true selves–leads perceivers to accord more power. Because authenticity is considered a virtue reflecting the moral inner-self, we further examine if the effect of authenticity on power affordance is due to its perceived morality. Extending previous research on antecedents of power affordance, we propose authenticity as a novel path to organizational power that can benefit even those with limited resources.

Our work offers a novel path to power and extends prior work on the political dynamics of power affordance and specifically on the role of moral behavior in upward mobility in labor markets. Practically, the results will suggest whether or not managers and employees should follow Polonius's advice: "To Thine Own Self be True".

 

The Corporation as a Regulatory Concept: From the Private Corporation to Global Value Chains


Doreen Lustig

The Safra Center Grant supported the research for the book Veiled Power: International Law and the Private Corporation 1881-1986, that was published recently with Oxford University Press. The book addresses, inter alia, the corporation as a regulatory concept since it deals with the history of corporate regulation and international law. More specifically, the last chapter of the book delves into the history of the concept of the multinational corporation and discusses its failure to become a signifier for regulatory intervention.

 

Outsourcing moral judgment to the law: implications for consumer behavior


Elinor Amit

Is there a market for being an ethically good company? And what is the price paid by companies for ethical transgressions? A large body of research shows that practices such as cause related marketing, which highlights social responsibility actions taken by the company (CRM; Varandarajan and Menon, 1988), are being rewarded by consumers, whereas unethical behavior meets dissatisfaction (e.g., Ingram, Skinner, & Taylor, 2005). While those observations are certainly true, they explain only part of the variance in consumer’s moral judgments. In the proposed research I argue that a crucial factor dominates consumer’s moral judgments: the legal status of action taken by a company. In particular, while consumers are perfectly capable of conducting moral reasoning (e.g., Bazerman & Gino, 2012; Greene et al., 2001), they substitute this reasoning with outsourcing moral judgment to the law whenever possible. For example, when asked whether it is wrong for doctors to accept money from pharmaceutical companies, consumers judge instead whether it is legal. This is because of a basic feature of human cognition: the tendency to rely on “communities of knowledge” (Sloman & Fernbach, 2017). In the proposed project I will use behavioral experiments to extend these preliminary findings and empirically examine the circumstances under which consumers outsource their moral judgment to the law; understand why they outsource their moral judgment; investigate the implications of moral outsourcing to consumer behavior; and identify exceptions to this rule. The proposed research sheds light on the role of the law in shaping people’s moral perceptions. Moreover, it suggests a surprising and ironic role for the law, of diminishing consumer’s independent, critical thinking. While illegal behaviors are being degraded to being ‘immoral’ even when having positive consequences, legal behaviors are being elevated to being ‘moral’ even when having terrible consequences. The proposed project has several important implications. First, it advances the understanding of the law’s role in whitewashing negative or even dangerous-but-legal practices of companies (i.e., a class of actions that can be collectively defined as institutional corruption; Amit, Koralnik, Posten, Muethel, & Lessig, 2017). Second, it suggests that in order to shape public’s moral perceptions of practices, it is not enough to portray these actions as negative, and highlights the importance of formal regulations as means of shaping moral perceptions. Finally, it emphasizes the need to develop supplementary moral authority sources of knowledge for industries.

 

What Matters to Investors? An Empirical Analysis of Investors' Ethical and Social Preferences”


Kobi Kastiel

There has been a longstanding, heated debate in corporate governance regarding the purpose of the corporation. On one side of this debate stand those who believe that the sole purpose of the corporation is to maximize value for its shareholders. In an enormously influential 1970 article, the economist and Nobel Laureate Milton Friedman set off the intellectual foundation for this view, known as the shareholder primacy approach, arguing that public companies should focus on maximizing their profits and leave the responsibility of addressing societal or ethical objectives, with no or limited connection to shareholder value, to the government or philanthropists.

On the other side of the debate stand those who believe that corporations should think beyond shareholders, and share a fundamental commitment to all stakeholders who contribute to the success of the corporation, including employees, customers, suppliers, and the community at large. According to this approach, known as the stakeholder approach, by taking a broader, more complete view of corporate purpose, companies can focus on creating long-term value, better serving all of their stakeholders. It has also been argued that shareholders themselves have other social preferences, and therefore maximizing shareholder welfare necessitates the corporation’s pursuit of these social preferences.

In this project, I intend to shed new light on this important debate by providing a comprehensive empirical analysis of the ethical and social preferences of public investors. By constructing a rich setting that includes a wide range of business decisions and different types of investors, the project will examine under what circumstances and to what extent public investors are willing to compromise their profits in order to maximize other social and ethical values. Finally, the project will also examine the considerable policy implications that arise from its empirical findings

 

 

Grants winners 2018-19:

 

Inequality and Discrimination in the Sharing Economy


Tamar Kricheli-Katz and Tali Regev

The past two decades have witnessed a series of technological developments that enabled the emergence of the “sharing economy” – online platforms that promote the sharing of goods, services, resources and talents among users through the Internet. This project focuses on peer-to-peer market platforms in which consumers pay to access goods and services for a period of time – like peer-to-peer financing (e.g. Prosper, Zopa), product markets (eBay) and short-term accommodations (e.g. AirBnB, Homeway). Whereas the emerging sharing economy enables more appealing and more ethical consumption options, as well as the creation of collaborative web communities, an emerging body of literature suggests that disparities in peer-to-peer online markets are significant in magnitude and implications. Yet, while this emerging body of literature is able to show that women and Black sellers and hosts are disadvantaged in peer-to-peer online markets, the data could not answer the question of why and how such disadvantages are obtained and whether they are similar in magnitude and causes to discrimination in other off-line markets. This project empirically investigates inequality and discrimination in the sharing economy and, as a result contributes to our understanding of the ways in which the cyber system should be regulated.

 

Sources and Implications of Fraudulent Behaviors - The Impact of Product Recalls on the Secondary Market: Evidence from Dieselgate


Itai Ater and Nir Yoseph, PhD candidate

We examine the effects of Volkswagen’s emissions scandal (“Dieselgate”) on the secondary car market in Israel. Using administrative data on all car transactions in Israel, we measure the scandal’s effect on the number and the composition of transactions involving used vehicles made by the Volkswagen Group. We also use data from the leading classified ad website and measure the effect of the scandal on the resale price of used Volkswagen vehicles. According to our findings, the Volkswagen emissions scandal had a statistically significant negative effect on the number of transactions involving vehicles made by Volkswagen (nearly -18.0%) and on their resale price (nearly -6.0%). We also find that the reduction in the number of transactions was driven mostly by private sellers and that non-private sellers barely shied away from the market. 

 

Constitutional Infrastructures


Doreen Lustig

The Safra Grant of 2018-2019 was dedicated primarily to the completion of a book manuscript and its submission to Oxford University Press and a completion of an article on the history of the rise and fall of the Chartered Company. I enclose the abstract of both research projects.


1. Veiled Power: International Law and the Private Business Corporation, 1886–1981 (OUP, Forthcoming) [~120,000 words].
This book presents a historical study of the international law of the private business corporation. It exposes and explores how international legal doctrines, practices, and institutions constituted a regulatory framework for the operation of businesses throughout the twentieth century. Until now, the relationship between businesses and interenational law has been embedded in a narrative of marginalization and failure, which this book now seeks to challenge. This book attempts to replace the unchallenged history of the irrelevance of international law to the question of business enterprises with a history of its facilitative role in constituting an economic order that proved highly beneficial to interests in the Global North.
The book draws inspiration from scholarship on the history of international trade law, international investment law, the history of global governance, and political economic analysis of international law, and connects these specialized fields in a single lens: the corporate form. The point of departure for this history is the simultaneous emergence of international law as a modern legal discipline and the turn to free incorporation in corporate law during the last third of the nineteenth century. The book demonstrates how the interplay between the sovereign veil of the state and the corporate veil of the company insulated corporations from responsibility and rendered them invisible to legal scrutiny. In the 1950s, decolonized nations began to turn the tables against powerful nations and business corporations by using the same ideas of the sovereign and corporate veils against unruly
corporate power. Amid the menace of the old international legal vocabulary in the service of new states, capital-exporting countries sought an alternative legal framework that would eventually hold sway—the new regime of international investment law.


2. Chartered International Law: The Rise and Fall of Chartered Companies in Africa, 1881-1923 (will be submitted to American Journal of Legal History during September).
The period between 1870 and 1914 saw particularly rapid levels of private business corporation-creation; from the 1880s, the numbers and size of multinationals grew rapidly. The 1880s mark the formative period of international law as a legal discipline and the turn to the privately-incorporated business corporation as a global actor, and thus constitutes an important turning point in the global history and theory of corporations. This article analyzes the rise and fall of the chartered company during the Scramble for Africa and examines its implications for the regulatory influence of international law on business practices in the forthcoming decades.
International lawyers of the late-nineteenth century sought to bring order to the messy legal landscape in Africa by dictating who was to be considered a sovereign (the imperial government) and who was not (the company); what was legitimate monopoly (sovereign monopoly over violence) and what was not (monopoly over trade); or who was the harbinger of humanity (the civilizing imperial government) and who was not (the company men, with their devotion to profit). But reading their commentaries alongside the experience of post-charter companies challenges this tidying-up endeavor. The move away from the chartered company to the post-charter business enterprise did not necessarily result in the resumption of responsible governance on the part of the imperial state. Nor did business enterprises make a radical shift away from the practices associated with the charter era. Rather than a history of a clear rupture from informal to formal empire or a move to a clearer distinction between public and private, the shift from chartered to private business corporations was not a transition from informal empire (through the chartered company) to formal empire (governmental colonial rule), but rather a transition to a different modality of informal and flexible alliance between governments and private corporations.

 

Ethical Dilemmas in Israeli Class Action Litigation


Alon Klement

The class action is a unique procedure. Unlike an individual lawsuit, which is filed by a plaintiff who then makes the main litigation decisions, a class action is initiated and controlled by the class attorney. In many class actions, it is the attorney who identifies the cause of action, selects the representative plaintiff, and decides how to litigate, whether to settle and for how much.

The class action thus raises unique ethical dilemmas which span the relationships between the attorney and the representative plaintiff, between the attorney and the represented class, among class members, and between them and the representative plaintiff. In addition, the class action implicates questions regarding the attorney’s duties to the court and the defendant, questions that are, by and large, absent in ordinary litigation. 

Despite the increasing surge of class action filings since the enactment of the Class Action Law in 2006, there is almost no discussion of these ethical issues in Israeli literature, and their consideration by the courts is rare. Also, the Israeli bar’s professional code of ethics has not been adjusted for the specific concerns raised by class actions, and it does not address many of their distinctive features.

The proposed research will examine these issues from a broad and comprehensive perspective, addressing the specific characteristics of the legal profession, the significant role of entrepreneurial lawyering in class actions, and the unique features and objectives of the class action procedure. One of the goals of the proposed research is to construct a professional code of ethics that would guide class attorneys’ conduct, realize the goals of class actions and minimize their inherent problems and costs.

 

The New Information Age: Experience and Regulation


Talia Fisher and Roy Kreitner

Current developments in information technology, and especially the widespread transformation of information into data, suggest that we are on the cusp of a new historical epoch. On the one hand, algorithms allow the individual an expanded range of choice, revealing “preferences” that the individual herself could not have been aware of on her own; these revelations in turn may form the basis of new connections, deepened interests and emotional investments, or in short, new identities. In this sense, data analysis contributes to a qualitative jump in the experience of information, in line with the movement of modernity. On the other hand, algorithmic individualization – in personalized medicine, in the tailoring of consumer supply to data-revealed tastes (channeling, and perhaps manufacturing demand), in the cabining of options on offer – is indeed a heightened individualization, but one that makes choice redundant. The individual becomes a data set uniquely pointing to certain outcomes; the individual might be called on to affirm or reject (to click or not to click), but the process of forming preferences has been qualitatively altered.

Many aspects of the issues raised here have been studied, but we aim to offer a consolidation of fields that will offer new insight. Our ambition is to transcend the disciplinary boundaries that typically limit academic appreciation of the big picture by merging historical, economic, institutional and normative perspectives.

The registers of experience and control never exist in isolation; their relationship is not mechanical, but also not so mysterious that it cannot be accounted for. We hope to generate an analytic framework that can make sense of the interplay between these two registers, using historical ideal types as a rough guide. We intend to pursue the research in two tiers. The first tier comprises field level analyses of new information technologies, and runs in two directions. First, the impact of technologies on the use, organization and control of information, especially the transformation of information into analyzable and marketable data. This aspect of the research deals with institutional change, and focuses on the legal and regulatory realms; second, the impact of technologies on the lived experience of information by individuals. The culmination of the first tier of the research will be an account of the dynamic interaction between these two aspects – explaining how institutional change and the experience of information feed into one another.

The second tier of the research is geared toward normative assessment. The initial steps toward such assessment are historical and analytical. They will provide a synoptic overview illuminating the risks and opportunities that changes in the experience and control of information present. Because we see that situation as a critical juncture, as possibly a moment of the constitution of a genuinely new phase in history, the normative inquiry is far-reaching and open-ended. It may alter not simply the way we view the relationship between technology and information, but also our most basic sense of the nature and value of individuality, of choice, of markets, of communal interaction, and of politics.

 

The double Edge Regulation of the Hebrew Word - Hebrew Books Market Management in the Post-Incunable Era, Between Papal and Jewish Law


Maoz Kahana

The Proposed study asks to tie the evolving field of “The History of the Book”, which deals with textual knowledge and its production, with the historical-phenomenological research concerning the religious law, state law and regulation, and their attitude towards the ethics of knowledge transmission. This cultural interjunction takes place in a historical context which characterized by a technological shift, economical pressure and political tension between coexisting societies, namely: A Jewish minority society and a Christian majority society.

The mid-fifteenth century’s invention of the printing press by Johannes Gutenberg lead to the development of a new sixteenth century book market. The new market was highly competitive, full of technological innovations, literary thefts and industrial espionages. The wild market was soon to take a serious percentage of the income of some major European cities and to be answered by a branched regulation of printing permissions, developed system of censorship and unprecedented copyrights laws.

The Hebrew books market was working under the tension created by two parallel, sometime contradictory, systems of law. The first one was the Papal law, who aimed to control the Jewish minority as citizens of lower status. This status had a complicated nature, while the Jewish literature was considered as a threat for the Christian majority, a threat that was emphasized by the historical overtones of the mutual Jewish-Christian tradition. The Papal law limited the possibility to publish Hebrew books and gave the permission to publish only to certain publishers. The other system is the partly independent Jewish Halakhic legal system, to whom the workers and the customers of the Hebrew book industry belonged. Jewish workers, readers and scholars turned to this system in order to regularize the production of problematic books, or to legalize the copyright of certain book or edition for limited period. The fact that the Jewish books market was subject to two parallel and sometime contradictory systems of law, in a time both of those, themselves stood in the middle of deep process of change, created a dynamic feedback effect, full of ups and downs.

This project will describe the complicated ethical perceptions regarding knowledge production and their regulative expressions in both legal systems and the way in which those parallel systems created close relationships, where one was built on the top of the other and while the other was using the lacunae created by the first. This research will be built upon a careful, historical investigation and legal-ethical description of certain case studies in which those both systems were put in motion, parallelly, even if not necessarily in a harmonious way. The expected result is a thicker, historical. ethical and cultural description of the way in which in this historical turning point to modernity, Jewish book market and its ethics were formed and designed.

 

 

 

Grants winners 2017-18:

 

Can Discrimination be Ethical?


Ronen Avraham

In this research project, we explore the ethical limits of an unobserved before type of discrimination which we (temporarily) call: beneficial statistical discrimination (BSD). Under this practice, a rational agent pursues her own self-interest by statistically discriminating against a disadvantaged group. The unique feature of BSD is that the targeted group also benefits from the practice. Should such practice be allowed? Should it be encouraged or even required? What role should the victim-group’s consent to such a practice play?

     While there is voluminous literature, written by lawyers, philosophers, economists and other public policy makers on intentional discrimination, statistical discrimination and affirmative action, to the best of our knowledge there is no literature on BSD. This project will fill this gap by a) developing a rational choice model of beneficial statistical discrimination, and b) analyzing  its ethical and social desirability.

      The research project is expected to make several contributions. It shall contribute to our normative understanding of the ethics of discrimination and consent, to the economic literature on statistical discrimination as well as to the doctrinal analysis of various legal practices, especially in torts and insurance. The project will last a year and will include both economic modeling and philosophical inquiry. The output is a 25,000 words paper in English. 

     To have a better grasp of the problem, consider the following example; suppose black neighborhoods cannot attract doctors because they cannot compensate the doctors enough for their high value medical services. Because doctors on average confer more benefits than harm, the black neighborhoods are very interested in their services. As a result, they attempt to attract doctors by offering them lower risks of malpractice suits. An OBGYN who makes $300,000 a year but has to pay $150,000 liability insurance might feel incentivized to work in a black neighborhood where she makes only $200,000 but her insurance premium is just $20,000 due to a lower standard of care. As before, the blacks themselves might be better off – without a reduction in the standard of care they will get no OBGYN at all. Should the law allow such transactions?

 

Public attitudes toward the manipulation of behavior for the overall benefit of society


Ayala Arad and Ariel Rubinstein

In this project, we intend to experimentally analyze a policy question of major importance: Are people interested only in the consequences of government policy or do they also care  about the methods by which the consequences are achieved? Do people object government interventions that use psychological manipulations to alter their behavior even if they fully agree with the goals of those interventions? Is the opposition to such interventions strong enough that they are prepared to take actions not in their best interests in order to express that opposition? Do individuals prefer interventions that are less manipulative even at the expense of their effectiveness?

     The project is related to the recent debate in academic circles regarding the type of intervention currently referred to as “nudges”, which have recently become popular in many Western countries.

 

 

 

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