Ethical Fit, Diversity, and Attrition: Behavioral Evidence from Emissions Inspections

In this paper we explore how person-organization (P-O) ethical fit affects the tenure of employees. We argue that the ethical misfit between employees and their organization is asymmetric, such that one direction can have a stronger effect on attrition than the other. We also present the role that ethical diversity within the organization can have in mediating this effect through potential person-group (P-G) fit in subgroups or subcultures. Using a unique dataset of over 6 million vehicle emissions tests, we identify pre-hiring levels of testing fraud for individual inspectors and facilities, finding that the P-O ethical misfit strongly influences the longevity of tenure. Furthermore, we show that the effects of misfit on attrition are asymmetric, and that ethical diversity also influences attrition. We further argue that using pre-hire behavioral data, when available, can be an important methodology in understanding the role of fit in performance and attrition. Both scholars and managers recognize that the fit between an organization and its individual members can be a critical determinant of job satisfaction, tenure, and performance. As noted by Schneider (2001), " of all the issues in psychology that have fascinated scholars and practitioners alike, none has been more pervasive than the one concerning the fit of person and environment " (p. 141). This