“Offshoring, Automation, and the Legitimacy of Efficiency”
by Stefano Puntoni
Wharton School
https://zoom.us/j/3370698252?pwd=OWRmQ1hNNWhRWng2QnhsTENzK1hGUT09&omn=99687732034
Meeting ID: 337 069 8252
Abstract:
Collective layoffs can occur for many reasons, often related to a firm’s pursuit of greater efficiency and cost reduction, and they tend to trigger negative reactions among the public. Anecdotal evidence suggests that offshoring, one of the most controversial and politicized aspects of globalization, evokes particularly negative reactions. We propose a social contract account of consumer reactions to collective layoffs and demonstrate differential consumer responses to collective layoffs due to offshoring versus other reasons, such as automation. Layoffs due to offshoring are perceived as an especially egregious violation of the normative expectation that firms should support the local community. Data from eleven experimental studies (N = 6,773), public consumer responses to layoffs in a large online community (N = 29,045), and layoff announcements in the European Union (N = 1,261) confirm that consumers react more negatively to collective layoffs due to offshoring compared to automation or other reasons. Supporting our social contract account, the negative effect of offshoring is stronger when offshoring affects workers in the consumers’ home (vs. foreign) country, when the firm is domestic (vs. foreign), and when most customers are domestic (vs. foreign).
Bio:
Stefano Puntoni is the Sebastian S. Kresge Professor of Marketing at The Wharton School and the Co-Director of AI at Wharton. He holds a PhD in marketing from London Business School and a degree in Statistics and Economics from the University of Padova, in his native Italy. His research has appeared in many leading academic journals and major managerial outlets. Most of his ongoing research investigates how new technology is changing consumption and society, including how humans are adopting and evolving with AI. He is a former MSI Young Scholar and MSI Scholar, and the winner of several grants and awards. He is currently an Associate Editor at the Journal of Consumer Research and at the Journal of Marketing. Stefano teaches in the areas of AI and automation, marketing strategy, and decision making.
