Can you “teach ethics?” I don’t know. But I do know that we can teach about the economic and social consequences of unethical behavior and challenge students to think through how they themselves would behave when faced with a dilemma. At FTS, we have devised trading simulations that use experiential learning to focus on individual decisions involving unethical behavior, the relationship to social norms, and the impact of such behavior on social outcomes.
We do this by letting students trade stocks in a specially designed market simulation. The market setting provides a unique way for students to not only face ethical dilemmas but to go beyond that and evaluate the implications of unethical behavior by individuals and groups for society. In the exercise, a subset of market participants is provided with early information on the earnings of a firm. They have the option of accepting the information or declining it. The information is always correct, and if they accept it, it can help them trade and potentially make far greater profits than if they declined it. It is known that the information was not supposed to be leaked; whether it is illegal to accept the information is left ambiguous, but it is fairly clear that accepting it would be considered unethical behavior by most.