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How income and the economic evaluation of time affect who we socialize with outside of work
Jieun Pai, Sanford DeVoe & Jeffrey Pfeffer
Organizational Behavior and Human Decision Processes, November 2020, Pages 158-175
Building on research showing that organizational practices that highlight the monetary value of time can affect decisions about time use, we examined how income and the economic evaluation of time jointly predict decisions about socializing with others who can be instrumentally useful to people (e.g., colleagues). Using a multimethod approach of surveys and experiments, we found that income was a stronger predictor of both the economic value placed upon socializing with colleagues outside of work as well as the propensity to engage in such activities. When the economic value of time was high, individuals weighed the instrumental value of networking more heavily in their decision making about how to allocate time. These findings illustrate how organizational pay practices and the salience of income can influence decisions about daily social interactions outside of work.
The Payoffs of Higher Pay: Elasticities of Productivity and Labor Supply with Respect to Wages
Natalia Emanuel & Emma Harrington
Harvard Working Paper, December 2020
What do firms gain from raising pay for low-wage workers? Focusing on a Fortune 500 retailer, we estimate the impact of higher wages on employee productivity, turnover, and recruitment among warehouse and call-center workers, using the quasi-randomness induced by sticky wage-setting policies. We document finite wage elasticities of turnover (between −3.0 and −4.5) and recruitment (between 3.2 and 4.2), which suggest the firm has some wage-setting power. Yet, on the margin, raising wages by $1 increases productivity by more than $1, giving the firm an incentive to pay more, even if they could pay lower wages. These responses to pay emerge both in a setting where the firm discretely raised wages and in a setting where its wages remained constant while other firms raised pay. These effects reflect both changes in worker selection and changes in behavior of existing workers. We estimate that over half of the turnover reductions and productivity increases arise from changes in workers’ behavior. Finally, our estimates suggest considerable gender heterogeneity: Men’s turnover is more responsive to higher wages than women’s. But turnover effects are swamped by women’s stronger productivity response to higher pay. Together, the gender-specific elasticities suggest firms have an implicit incentive to set female wages above male wages and thus firm profits cannot explain the gender pay gap.
Constraining Ideas: How Seeing Ideas of Others Harms Creativity in Open Innovation
Reto Hofstetter et al.
Journal of Marketing Research, forthcoming
Open innovation contests that display all submitted ideas to participants are a popular way for firms to generate ideas. In such contest-based ideation, the authors show that seeing numerous competitive ideas of others harms, rather than stimulates, creative performance (Study 1). Others’ competitive prior ideas interfere with idea generation, as new ideas need to be differentiated from the preceding ones to be original. Exposure to an increasing number of prior ideas thus heightens individuals’ perceived constraints of expressing ideas and harms creative performance (Studies 2 and 3). Furthermore, creative performance monotonically reduces with an increasing number of prior ideas (Study 4). A final study demonstrates that showing only a limited number of ideas as well as grouping prior ideas offer actionable ways to reduce prior ideas’ harmful influence (Study 5). These results illustrate viable ways to improve contest-based ideation outcomes merely by changing how competitive prior ideas are presented.
Job Decision Latitude Lowers Worker Stress, but for Whom? Results from the National Longitudinal Study of Adolescent to Adult Health
Adam Lippert & Grace Venechuk
Population Research and Policy Review, December 2020, Pages 1009–1017
Prior research shows job decision latitude is associated with stress. Few studies of this association address omitted-variable bias or how employee gender and educational attainment modify this relationship. This study refines estimates of this association in a panel study of young adults entering mid-adulthood, and tests whether this relationship varies by worker gender and education. The sample consisted of 1937 working women and men in Wave 4 and Sample 1 of Wave 5 in the US National Longitudinal Survey of Adolescent to Adult Health (Add Health). Fixed effects regression was used to assess changes in job decision latitude and stress controlling for time-varying controls and omitted time-invariant factors. Fixed effects estimates revealed an inverse association between increasing job decision latitude and stress (b = − .19; 95% CI − .33, − .05). Gender did not modify this association nor did worker education. Increasing job decision latitude is associated with lower stress over time for working women and men. Results suggest that enhancing job decision latitude can benefit a variety of women and men entering their prime working years.
Rethinking reappraisal: The double-edged sword of regulating negative emotions in the workplace
Matthew Feinberg, Brett Ford & Francis Flynn
Organizational Behavior and Human Decision Processes, November 2020, Pages 1-19
Cognitive reappraisal can benefit employees, in terms of their emotional health. However, we propose that reappraisal can also entail hidden costs. Drawing on social-functionalist emotions theory, we posit that the use of reappraisal to control negative self-conscious emotions (guilt and shame) results in both positive employee outcomes (increased satisfaction, decreased burnout) and negative employee outcomes (increased counterproductive workplace behaviors (CWBs)). In Study 1, employees who used reappraisal to control guilt and shame were more satisfied and less burnt out, but also more likely to engage in CWBs. In Study 2, employees described what CWBs they would engage in if they faced no consequences: those using reappraisal to control guilt and shame reported more unethical CWBs and a greater willingness to actually perform the behavior. Study 3 assessed working MBA students in a live interaction (a heated negotiation), finding those who used reappraisal to control guilt and shame behaved more unethically. Studies 4 and 5 experimentally manipulated the use of reappraisal to control guilt and examined its effect on CWBs. Individuals in the reappraisal condition were more likely to withhold valuable resources from task partners (Study 4) and cheat on a work task (Study 5) than individuals in a control condition, providing causal evidence that reappraisal led to more CWBs.
To Apologize or Justify: Leader Responses to Task and Relational Mistakes
Andrea Hetrick et al.
Basic and Applied Social Psychology, forthcoming
Leadership roles are complex, creating an environment where leaders are likely to make mistakes that result in negative outcomes. We shift the conversation in the literature from examining the effectiveness of mistake responses toward exploring why leaders use different mistake recovery methods. We employ an online experimental method to distinguish between task and relationship mistakes for leaders and suggest that different attributions are made for these two types of mistakes (Study 1). We found that task mistakes are viewed by leaders as more specific and less personal, and that relationship mistakes are viewed as more global, describing the leader’s stable characteristics rather than a specific event. From these findings, we predict that leaders are more likely to apologize for task mistakes and are more likely to justify their relationship mistakes rather than admit wrongdoing for them. We find support for these predictions using a mixed methods approach, employing a laboratory experiment (Study 2) and a critical incident method surveying a panel of leaders (Study 3). As such, this paper extends our understanding of the mistake recovery process for leaders by demonstrating that 1) leaders’ relationship mistakes are viewed as more globally representative of the leader than task mistakes, and 2) leaders are more likely to apologize for task mistakes but more likely to justify relationship mistakes. Relational and task mistakes, however, were not found to be different in regard to their ambiguity or the extent to which they were viewed as a mistake.
Moving Violations: Pairing an Illegitimate Learning Hierarchy with Trainee Status Mobility for Acquiring New Skills When Traditional Expertise Erodes
Katherine Kellogg et al.
Organization Science, forthcoming
We explore how members of a community of practice learn new tools and techniques when environmental shifts undermine existing expertise. In our 20-month comparative field study of medical assistants and patient-service representatives learning to use new digital technology in five primary care sites, we find that the traditional master-apprentice training model worked well when established practices were being conferred to trainees. When environmental change required introducing new tools and techniques with which the experienced members had no expertise, third-party managers selected newer members as trainers because managers judged them to be agile learners who were less committed to traditional hierarchies and more willing to deviate from traditional norms. This challenged community members’ existing status, which was based on the historical distinctions of long tenure and expertise in traditional tasks. In three sites, the introduction of this illegitimate learning hierarchy sparked status competition among trainees and trainers, and trainees collectively resisted learning new tools and techniques. In the other two sites, managers paired the new, illegitimate learning hierarchy with the opportunity for trainee status mobility by rotating the trainer role; here, trainees embraced learning in order to exit the lower-status trainee group and join the higher-status trainer group. Drawing on ideas of status group legitimacy and mobility, we suggest that managers’ pairing of an illegitimate learning hierarchy with the opportunity for trainee status mobility is a mechanism for enabling the situated learning of new techniques when traditional expertise erodes.
On the hiring of kin in organizations: Perceived nepotism and its implications for fairness perceptions and the willingness to join an organization
Omar Burhan, Esthervan Leeuwen & Daan Scheepers
Organizational Behavior and Human Decision Processes, November 2020, Pages 34-48
Nepotism is often condemned, but little is known about what people construe as nepotism, and why it is considered problematic. In five experiments, conducted in Indonesia and the U.S.A., we addressed the question whether the employment of a competent family member is considered just as nepotistic and unfair as the employment of a less competent family member. In Studies 1 (N = 101) and 2 (N = 200), participants construed the hiring of a relative within the same organization as nepotism, regardless of the relative’s competence. In Studies 3 (N = 229) and 4 (N = 204), the hiring of relatives was seen as problematic because it violated principles of procedural fairness. Study 4 also showed that nepotism was viewed as more unfair than cronyism (employment based on a social network). Study 5 (N = 173) showed that perceived nepotism can hinder an organization’s ability to attract qualified personnel by demonstrating that potential job applicants were less likely to apply for a job at a prestigious but nepotistic organization compared to a less prestigious and less nepotistic organization.
Leveraging Upfront Payments to Curb Employee Misbehavior: Evidence from a Natural Field Experiment
John List & Fatemeh Momeni
European Economic Review, forthcoming
We use a natural field experiment in which we hired over 2,000 workers from an online labor market to explore how upfront payment affects worker motivation and misbehavior on the job. We start with a simple theory that shows paying upfront can increase misbehavior through reducing the perceived costs of cheating, but it can decrease misbehavior through generating a gift-exchange effect. Motivated by the theory, we designed a task that provided workers with opportunities to reciprocate or misbehave. A unique aspect of our design is that we are permitted an opportunity to measure the curvature of the gift-exchange value of the upfront payment. Our results suggest paying workers upfront induces a gift-exchange effect that is concave in the share of total wage paid upfront. Moreover, the impact is strong enough to suggest that small upfront payments are a cost-effective means for an employer to curb employee misbehavior.