Decentralized enforcement in organizations: An experimental approach

Social enforcement, the decentralized action by organizational actors of monitoring, identifying, and reporting legal violations, is widely recognized as a key factor in ensuring good governance. This article reports on an experimental survey conducted in the US and Israel examining the behavior of individuals when confronting workplace unlawful conduct. The study provides novel insights into the relationships between state based, organization based, and employee based enforcement. It finds that the likelihood and the manner of reporting will vary depending on the type of illegality and are strongly correlated to perceptions of legitimacy, job security, and voice within the workplace. Comparing illegalities, employees prefer to report clear violations by rank and file employees rather than violations by managers. At the same time, external reporting to government or media entities is most likely when violations involve the organization as a whole or implicate top management. The study also finds cultural and gender differences in reporting patterns. Finally, the study provides support for the understanding that social norms are more predictive of social enforcement than expected organizational costs.