Measuring Management
Breaking ceilings: Debate training promotes leadership emergence by increasing assertiveness
Jackson Lu et al.
Journal of Applied Psychology, forthcoming
Abstract:
To date, little is known about what interventions can help individuals attain leadership roles in organizations. To address this knowledge gap, we integrate insights from the communication and leadership literatures to test debate training as a novel intervention for leadership emergence. We propose that debate training can increase individuals' leadership emergence by fostering assertiveness -- "an adaptive style of communication in which individuals express their feelings and needs directly, while maintaining respect for others" (American Psychological Association, n.d.) -- a valued leadership characteristic in U.S. organizations. Experiment 1 was a three-wave longitudinal field experiment at a Fortune 100 U.S. company. Individuals (N = 471) were randomly assigned to either receive a 9-week debate training or not. Eighteen months later, the treatment-group participants were more likely to have advanced in leadership level than the control-group participants, an effect mediated by assertiveness increase. In a sample twice as large (N = 975), Experiment 2 found that individuals who were randomly assigned to receive debate training (vs. nondebate training or no training) acted more assertively and had higher leadership emergence in a subsequent group activity. Results were consistent across self-rated, group-member-rated, and coder-rated assertiveness. Moderation analyses suggest that the effects of debate training were not significantly different for (a) U.S.- and foreign-born individuals, (b) men and women, or (c) different ethnic groups. Overall, our experiments suggest that debate training can help individuals attain leadership roles by developing their assertiveness.
AI Personality Extraction from Faces: Labor Market Implications
Marius Guenzel et al.
University of Pennsylvania Working Paper, March 2025
Abstract:
Human capital -- encompassing cognitive skills and personality traits -- is critical for labor market success, yet the personality component remains difficult to measure at scale. Leveraging advances in artificial intelligence and comprehensive LinkedIn microdata, we extract the Big 5 personality traits from facial images of 96,000 MBA graduates, and demonstrate that this novel "Photo Big 5" predicts school rank, compensation, job seniority, industry choice, job transitions, and career advancement. Using administrative records from top-tier MBA programs, we find that the Photo Big 5 exhibits only modest correlations with cognitive measures like GPA and standardized test scores, yet offers comparable incremental predictive power for labor outcomes. Unlike traditional survey-based personality measures, the Photo Big 5 is readily accessible and potentially less susceptible to manipulation, making it suitable for wide adoption in academic research and hiring processes. However, its use in labor market screening raises ethical concerns regarding statistical discrimination and individual autonomy.
Workers' response to monetary incentives in for-profit and non-profit jobs
Billur Aksoy, Angela de Oliveira & Catherine Eckel
Economic Inquiry, forthcoming
Abstract:
When workers decide how hard to work, they consider not only extrinsic factors (e.g., the salary), but also the type of work and the mission of the organization. We study the relationship between monetary compensation and worker effort in non-profit and for-profit settings using a modified gift-exchange experiment. Contrary to some prior research, we find that having a mission does not reduce the responsiveness of effort to increasing wages. Workers are more responsive to higher wages in a non-profit setting, contributing to our understanding of how the presence of a mission and monetary payments interact in work settings.
Blaming the Strawless Brickmaker: Constraint Neglect in Judging Decision Quality
Xilin Li & Christopher Hsee
Journal of Behavioral Decision Making, January 2025
Abstract:
People often judge the quality of selection decisions made by others: The CEO of a firm may judge the quality of hiring decisions made by the firm's HR personnel; the readers of a journal may judge the quality of manuscript-acceptance decisions by the journal's editor. To accurately judge others' selection decision quality, evaluators should consider not only the outcome of the selection decisions but also the constraints of the decision-maker. For example, to judge the quality of the hiring decisions made by the HR personnel, the CEO should consider not only how many high-quality (vs. low-quality) candidates the HR personnel hired, but also how many high-quality (vs. low-quality) candidates applied, and how many candidates the HR personnel needed to hire. We theorize that evaluators tend to overlook these constraints, and, consequently, judge decision-makers who faced greater constraints as having made worse decisions than decisions-makers who faced lesser constraints, even if the former's decisions were actually as good as or better than the latter's. We refer to this phenomenon as Blaming the Strawless Brickmaker (from the saying "making bricks without straw"). Eight studies, employing mixed methods, demonstrate the Blaming-the-Strawless-Brickmaker effect, examine its underlying mechanism, and suggest ways to improve the quality of judged selection decision quality.
The Curious Surge of Productivity in U.S. Restaurants
Austan Goolsbee et al.
NBER Working Paper, March 2025
Abstract:
We document that, after remaining almost constant for almost 30 years, real labor productivity at U.S. restaurants surged over 15% during the COVID pandemic. This surge has persisted even as many conditions have returned to pre-pandemic levels. Using mobile phone data tracking visits and spending at more than 100,000 individual limited service restaurants across the country, we explore the potential sources of the surge. It cannot be explained by economies of scale, expanding market power, or a direct result of COVID-sourced demand fluctuations. The restaurants' productivity growth rates are strongly correlated, however, with reductions in the amount of time their customers spend in the establishments, particularly with a rising share of customers spending 10 minutes or less. The frequency of such 'take-out' customers rose considerably during COVID, even at fast food restaurants, and never went back down. The magnitude of the restaurant-level relationship between productivity and customer dwell time, if applied to the aggregate decrease in dwell time, can explain almost all of the aggregate productivity increase in our sample.
After shocks: The effects of internal sourcing on voluntary turnover
Jay Hardy et al.
Journal of Applied Psychology, forthcoming
Abstract:
Promoting internal employees to managerial positions (internal sourcing) is a popular employee retention tactic. Although some research indicates that internal sourcing reduces voluntary turnover, conflicting evidence suggests that internal sourcing strategies make employees more difficult to retain in strong job markets (i.e., when job opportunities are plentiful relative to job seekers) because promotions increase an employee's external marketability. The onset of the COVID-19 pandemic -- a global exogenous shock that triggered an event chain characterized by a weak job market followed by a historically strong one -- provided a unique opportunity to test these competing perspectives. Drawing upon event system theory and the unfolding model of turnover, we argue that internal sourcing creates positive perceptions among employees about their employer, making them less inclined to seek external opportunities during periods of heightened employee mobility. Specifically, we predict that internally sourced employees perceive lower levels of employment threat and higher levels of organizational support than those hired externally, which mitigates their turnover risk in strong job markets. We tested these predictions in two studies: a longitudinal field study involving 11,072 restaurant managers who were newly promoted or hired into their roles in the years surrounding the onset of the COVID-19 pandemic and the strong job market that followed and an experiment designed to mirror the field study conditions, in which we examined the psychological mechanisms underlying this phenomenon. Collectively, the results of our studies support our predictions, offering valuable insights into the effects of internal versus external sourcing on employee retention.
Rationalizing Firm Forecasts
Nicholas Bloom, Mihai Codreanu & Robert Fletcher
NBER Working Paper, January 2025
Abstract:
We partner with a large US payment-processing company to run a 5-year, 10 wave panel survey of incentivized quarterly sales forecasts on over 6,000 firms. We match firm predictions to proprietary revenue data to assess accuracy. We find firms forecast poorly, with issues of inaccuracy, over-optimism, predictable errors and over-precision. To assess the causes of these forecasting issues we run experiments on: (i) data use, (ii) incentives, (iii) forecasting skill, and (iv) contingent thinking. We find greater data use primarily decreases noise and reduces over-precision, while higher incentives moderate over-optimism. Both moderately increase accuracy. The other two treatments have no impact. These results suggest forecasting biases can be reduced but are hard to eliminate. In a simple simulation model, we show these biases change firm responsiveness to changes in taxes and productivity, highlighting their macro importance.