The downside of moralizing financial markets: Anti-Semitic stereotypes in German MTurkers

Abstract

Society increasingly demands ethical motives from investors. Like other judgments, however, the moral evaluation of investments can be influenced by stereotypes. We investigate whether subjects’ evaluation of investments as immoral violates the commonly accepted principle of moral impartiality—the view that moral evaluations of actions must not depend on the actor’s arbitrary personal characteristics. Recently, the media discussed such a violation when criticizing an internal remark of a German financial regulator (BaFin), which stated that most short sellers of Wirecard stocks came from Israel was “striking”. Through a between-subjects experiment, we find that young German MTurkers with generally centrist political attitudes display behavior consistent with an anti-Semitic stereotype: They are much more likely to evaluate the very same investment as immoral if it is made by an investor with a name perceived as Jewish. The triggering of this stereotype should prompt us to consider the moral evaluation of investors with caution.