Imprudence and Immorality: A Kantian Approach to the Ethics of Financial Risk

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27 Scopus citations


This paper takes up recent challenges to consequentialist forms of ethically evaluating risks and explores how a non-consequentialist form of deliberation, Kantian ethics, can address questions about risk. I examine two cases concerning ethically questionable financial risks: investing in abstruse financial instruments and investing while relying on a bailout. After challenging consequentialist evaluations of these cases, I use Kant's distinction between morality and prudence to evaluate when the investments are immoral and when they are merely imprudent. I argue that the investment practices are imprudent when they do not take adequate precautions to secure the firm's long-term flourishing. They are immoral in a Kantian sense when they risk the destruction of the financial system upon which the firms depend. The upshot of my analysis is that moral actions require more risk aversion than prudent actions and prudent actions require more risk aversion than expected-value-maximizing actions.

Original languageEnglish (US)
Pages (from-to)243-265
Number of pages23
JournalBusiness Ethics Quarterly
Issue number2
StatePublished - Apr 1 2015
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • General Business, Management and Accounting
  • Philosophy
  • Economics and Econometrics


  • Ethics of Risk
  • Financial Risk
  • Formula of Universal Law
  • Investment Ethics
  • Kantian Ethics
  • Too Big To Fail


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