Theory →
- 28 Jul 2014
- Research & Ideas
Eyes Shut: The Consequences of Not Noticing
In his new book The Power of Noticing: What the Best Leaders See, Max Bazerman explains how and why many executives fail to notice critical information in their midst. Open for comment; 0 Comments.
- 19 Jun 2014
- Working Paper Summaries
Wisdom or Madness? Comparing Crowds with Expert Evaluation in Funding the Arts
In fields as diverse as technology entrepreneurship and the arts, crowds of interested stakeholders are increasingly responsible for deciding which innovations to fund, a privilege that was previously reserved for a few experts, such as venture capitalists and grant-making bodies. Despite the growing role of crowds in making decisions once left to experts, however, we know little about how crowds and experts may differ in their ability to judge projects, or even whether crowd decision-making is based on any rational criteria at all. Drawing on a panel of national experts and data from the crowd funding platform Kickstarter, this study offers the first detailed comparison of crowd and expert judgment. There are three main findings. First, on average, there is a remarkable degree of congruence between the realized funding decisions by crowds and the evaluation of those same projects by experts. Second, there seems to be an "art" to raising money from crowds, one that may be systematically different from that of raising money from experts. Third, crowd funded projects are equally likely to have delivered on budget, result in organizations that continue to operate, and be successful in other ways. Overall, crowd funding appears to allow projects the option to receive multiple evaluations and reach out to receptive communities that may not otherwise be represented by experts. Key concepts include: Crowds and experts make similar funding decisions. Where crowds and experts disagree, it is far more likely to be a case where the crowd is willing to fund projects that experts may not. Despite this, the findings show no quantitative or qualitative differences between projects funded by the crowd alone and those that were selected by both the crowd and experts. Closed for comment; 0 Comments.
- 13 May 2014
- Working Paper Summaries
The Contaminating Effects of Building Instrumental Ties: How Networking Can Make Us Feel Dirty
Network ties are essential to advancement in organizations: they provide access to opportunities, political insight, and technical knowledge. Yet networking with the goal of advancement often leaves individuals feeling somehow bad about themselves—even dirty. The authors use field and laboratory data to examine how goal-oriented or instrumental networking influences individual emotions, attitudes, and outcomes, including consequences for an individual's morality. The authors argue that networking for professional goals can impinge on an individual's moral purity—a psychological state that results from a person's view of the self as clean from a moral standpoint and through which a person feels virtuous—and thus make him or her feel dirty. There are three main insights: First, the authors show the importance of a clear conceptual distinction between instrumental networking driven by individual agency versus spontaneous networking reflecting the constraints and opportunities of the social context. Second, the research establishes the relevance of moral psychology for network theory. Third, because people in powerful positions do not experience the morally contaminating effects of instrumental networking, power emerges from this research as yielding unequal access to networking opportunities, thus reinforcing and perpetuating inequality in performance. Key concepts include: Professional-instrumental networking is the purposeful creation of social ties in support of task and professional goals. The content and approach of networking each influence the psychological experience of those engaging in it, including a person's feelings of moral purity. The amount of power people have when they engage in instrumental networking for professional goals influences how dirty such networking can make them feel. Organizations need to create opportunities for emergent forms of networking, because people who need instrumental networking the most are the least likely to do it. Closed for comment; 0 Comments.
- 09 May 2014
- Working Paper Summaries
‘My Bad!’ How Internal Attribution and Ambiguity of Responsibility Affect Learning from Failure
As scholars and practitioners have observed, failure clearly presents a valuable opportunity for learning in organizations. All too often, however, the opportunity is lost. Indeed, prior studies on the topic suggest that, perhaps ironically, such learning often fails to occur. In this paper the authors begin to uncover when and why individuals are more likely to learn from failed experiences. Specifically, they present evidence from three studies that support a conceptual model of learning from failure as operating through individuals' internal attributions of failure, driven in part by low ambiguity of responsibility, that lead to increased learning effort and subsequent improvement. The paper thus makes theoretical advances and carries implications for managers. Theoretically, the authors focus attention on the role of attribution in learning from failure, showing that attribution style is an important moderator of the relationship between failure and learning. Next, they identify a key situational determinant of individuals' responses to failure: ambiguity of responsibility. Third, they highlight the key role of effort as a mechanism for the effects of learning from failure. For managers, these results emphasize a specific measure that organizational leaders might take before an experience to enhance learning: actively managing perceptions of ambiguity of responsibility. Key concepts include: This paper offers a more nuanced view of learning that provides an integrated conceptual model for understanding individual learning from failure. Managers in organizations should think carefully about how ambiguity of responsibility is likely to play out in their context, utilizing strategies such as job design to help to limit this effect. Upfront planning might remove possible barriers that would increase ambiguity of responsibility. Feedback could influence these ambiguity perceptions as well. Closed for comment; 0 Comments.
- 17 Apr 2014
- Working Paper Summaries
Poverty and Crime: Evidence from Rainfall and Trade Shocks in India
Concern about climate change has spurred a large body of scholarship examining how climate influences human behavior, particularly human conflict. While a link between climate and human conflict is well established, we still do not fully understand the mechanisms that underlie the observed relationship between rainfall and crime. In this paper the authors shed light on these mechanisms using four decades of district-level data from India. They first establish a robust effect of rainfall on different types of crime, with the strongest effects on violent crimes (including murder) and property crimes. They then go beyond previous studies, which simply document the link between weather variations and human conflict, and examine to what extent poverty is the main causal pathway between rainfall and crime. To do so they identify a source of income shocks for households in rural India that is completely independent of the amount of rainfall: trade reform that began in 1991. Findings show that violent crimes and property crimes, the types of criminal activities that are most sensitive to rainfall shocks, indeed respond to trade shocks. The larger the loss in trade protection a district experienced, the higher is the incidence of these crimes. Overall, the results provide evidence for income as a mechanism behind the observed rainfall-crime relationship, which had mostly been assumed in previous scholarship. Key concepts include: Violent crimes and property crimes rise during periods of low rainfall and/or higher exposure to foreign competition. Other crime categories such as crimes against women do not show a strong relationship with either periods of low rainfall and/or higher exposure to foreign competition. Closed for comment; 0 Comments.
- 26 Feb 2014
- Research & Ideas
How Grocery Bags Manipulate Your Mind
People who bring personal shopping bags to the grocery store to help the environment are more likely to buy organic items—but also to treat themselves to ice cream and cookies, according to new research by Uma R. Karmarkar and Bryan Bollinger. What's the Quinoa-Häagen-Dazs connection? Closed for comment; 0 Comments.
- 24 Feb 2014
- Research & Ideas
Uncovering Racial Discrimination in the ‘Sharing Economy’
New research by Benjamin G. Edelman and Michael Luca shows how online marketplaces like Airbnb inadvertently fuel racial discrimination. Closed for comment; 0 Comments.
- 19 Feb 2014
- Research & Ideas
Racist Umpires and Monetary Ministers
Are baseball umpires racist? Are ministers motivated by money? Christopher Parsons teases important economic lessons from unlikely sources. Open for comment; 0 Comments.
- 29 Oct 2013
- Research & Ideas
Do Employees Work Harder for Higher Pay?
In a recent field study, Duncan Gilchrist, Michael Luca, and Deepak Malhotra set out to answer a basic question: "Do employees work harder when they are paid more?" Closed for comment; 0 Comments.
- 25 Oct 2013
- Working Paper Summaries
Management: Theory and Practice, and Cases
The author reflects upon his diverse experiences throughout his career with the benefits and challenges of case method teaching and case writing. The case method is undergoing tremendous innovation as students in the twenty-first century engage in learning about corporations, management, and board oversight. In particular, the creative and analytical process of writing the novelAdventures of an IT Leader is examined. The book's "hero's journey" foundation continued in a second Harvard Business Press book, Harder Than I Thought: Adventures of a Twenty-First Century Leader, focusing on CEO leadership in the global economy and the fast-changing IT-enabled pace of business. A third novel is in preparation: It concerns corporate leadership challenges into reinventing boards of directors for the twenty-first century. Key concepts include: A novel-based series of books is incorporating the "hero's journey" classic story structure along with the creation of associated fictional case characters designed to engage readers in the dimensions of human behavior, decision making, and judgments in carrying out the work of the modern corporation. Closed for comment; 0 Comments.
- 18 Sep 2013
- Research & Ideas
Unspoken Cues: Encouraging Morals Without Mandates
Harvard Business School professor Michel Anteby studied his own employer to better understand how organizations can create moral behavior using unspoken cues. Closed for comment; 0 Comments.
- 18 Sep 2013
- Research & Ideas
Excerpt: Manufacturing Morals
At Harvard Business School, the orderly landscape and community setting reinforces values the School wishes to introduce to both faculty and students. An excerpt from professor Michel Anteby's Manufacturing Morals: The Values of Silence in Business School Education Closed for comment; 0 Comments.
- 05 Sep 2013
- Working Paper Summaries
Performance Responses to Competition Across Skill-Levels in Rank Order Tournaments: Field Evidence and Implications for Tournament Design
Tournaments and other rank-order incentive mechanisms have been used to model a wide range of settings: executive placement, elections, research and development and innovation contests, sports tournaments, and variable sales compensation: situations in which placing at the top of the performance rank-order leads to out-sized payoffs. This article analyzes how the level of competition and size of a tournament affects performance as a result of how strategic interactions affect contestants' incentives to exert high levels of effort. The authors estimate relationships between performance in these contests and competition levels across the full distribution of skill levels. They do this by studying data on software algorithm programming contests in which fine-grained data are available on contestant ability levels and performance over a large number of comparable contests. Findings show that while aggregate and average patterns of performance and effort may decline with increased competition, performance and effort may in fact increase among the highest-skilled contestants. The paper provides guidance to designers of innovation and crowdsourcing tournaments. Key concepts include: Tournaments and contests have a long history as a means of achieving technological advances in a range of industrial settings. For the strongest contestants, adding more contestants can produce effort-inducing rivalry. Increased competition beyond a minimum level may reduce the probability of winning to a level where incentives become depressed. However, the stimulating effect of rivalry may persist at least for highest-skilled contestants. Closed for comment; 0 Comments.
- 03 Sep 2013
- Working Paper Summaries
How the Zebra Got Its Stripes: Imprinting of Individuals and Hybrid Social Ventures
Creating hybrid organizations that combine existing organizational forms is a complex process. Given the legitimacy challenges facing hybrid organizations, why are they created in the first place? The authors focus on the role of "environmental imprinting" on individuals: this means the persistent effects that individuals' environments during sensitive periods have on their subsequent behaviors. After constructing and analyzing a novel dataset of over 700 founders of social ventures, all guided by a social welfare logic, the authors suggest that individual imprinting helps to explain why an entrepreneur founding a social venture might create a hybrid by incorporating a secondary, commercial logic. Overall, the paper contributes to the understanding of hybrid organizations by providing the first large-scale, empirical examination of the antecedents of the widely-discussed type of hybrids that combine social welfare and commercial logics. Key concepts include: Environmental imprinting refers to the effects that characteristics of individuals' environments during sensitive periods have on their subsequent behaviors. Entrepreneurs' direct exposure to various work environments through their own experience influences their likelihood to create a new hybrid venture. The findings contribute to institutional theory more generally by showing how environmental imprints on individuals may enable divergence from current, institutionalized structures, as well as how the contours of such imprints may vary with characteristics such as tenure and type of exposure. Closed for comment; 0 Comments.
- 21 Aug 2013
- Research & Ideas
To Buy Happiness, Spend Money on Other People
In a new video, Michael Norton shows that spending money on others yields more happiness than spending it on yourself. Closed for comment; 0 Comments.
- 19 Aug 2013
- Research & Ideas
Studying How Income Inequality Shapes Behavior
Professor David A. Moss is studying how growing income disparity affects our decision-making on everything from risk-taking to voting. Closed for comment; 0 Comments.
- 15 Aug 2013
- Working Paper Summaries
Competition and Social Identity in the Workplace: Evidence from a Chinese Textile Firm
Social identity theory suggests that individuals derive part of their self-concept from their perceived membership in a social group and behave differently towards in-group versus out-group members. But despite the importance of social identity in organizational contexts, the existing empirical evidence in managerial economics has mostly come from lab experiments, and there exist few quantitative studies on the impact of social identity on worker behaviors in real workplaces. This paper provides novel evidence of the impact of social identity on workers' competitive behaviors in a Chinese textile firm that uses relative performance incentives. The firm provides an unusual empirical setting in which there is a historical and institutional division of all weavers into two distinct groups with different social identities: urban resident and rural migrant workers. Our findings show that the weavers do not compete against coworkers who share the same social identity even though there is a tournament incentive to outperform their coworkers in general. Instead, they only compete against coworkers who do not share the same social identity. Managers who design incentive schemes without understanding the dynamics of social incentives in the workplace may fail to achieve the intended effects on productivity. Key concepts include: Social identity plays an important role in mitigating or amplifying the pecuniary incentives created by relative performance schemes. In an environment with tournament incentives, the competitive effect of tournaments may be mitigated among workers who share the same social identity, but amplified across different social groups. By taking advantage of the presence of social identities in the workplace, management can design and implement tournament that maximizes the beneficial effect of tournament and minimizes its "dark side." Closed for comment; 0 Comments.
- 12 Aug 2013
- Research & Ideas
‘Hybrid’ Organizations a Difficult Bet for Entrepreneurs
Hybrid organizations combine the social logic of a nonprofit with the commercial logic of a for-profit business, but are very difficult to finance. So why would anyone want to form one? Julie Battilana and Matthew Lee investigate. Closed for comment; 0 Comments.
- 05 Aug 2013
- Research & Ideas
To Buy Happiness, Purchase an Experience
Michael Norton explains why spending money on new experiences yields more happiness than spending it on new products. Closed for comment; 0 Comments.
Climbing Down from the Ivory Tower
Nava Ashraf explains why it makes sense for field researchers to co-produce knowledge with the people they study and serve. Open for comment; 0 Comments.