The Effects of Feeling (Un)trusted on Exploration in an Ambidextrous Decision Task

ABRAHAM, Diya Elizabeth. The Effects of Feeling (Un)trusted on Exploration in an Ambidextrous Decision Task. In ESA 2019 European Meeting (Dijon). 2019.

Basic information

• Original name: The Effects of Feeling (Un)trusted on Exploration in an Ambidextrous Decision Task
• Authors: ABRAHAM, Diya Elizabeth.
• Edition: ESA 2019 European Meeting (Dijon), 2019.

Other information

• Original language: English
• Type of outcome: Presentations at conferences
• Field of Study: 50200 5.2 Economics and Business
• Country of publisher: France
• Confidentiality degree: is not subject to a state or trade secret
• WWW: conference program
• Organization unit: Faculty of Economics and Administration

Abstract

Research on organizational ambidexterity acknowledges the role played by key decision makers in whether a firm can strike the right balance between the search for new knowledge (exploration) on the one hand and the use of existing knowledge (exploitation) on the other. Despite extensive work on the concept of organizational ambidexterity, the understanding of the factors that shape individual exploration and exploitation tradeoff decisions is still in the early stages. Research on intrinsic motivation and exploration suggests that the feeling that one is trusted (or untrusted) might be an important factor that affects individual exploration. According to this literature, intrinsic motivation is increased when an individual feels a sense of responsibility and impact of her/his choices on the outcome as well as when s/he perceives that there are high expectations of her/his competence with respect to the assigned task. Greater intrinsic motivation leads the individual to search for more information (explore) in order to achieve the best possible outcome while lower intrinsic motivation should decrease the time spent in search and lead to greater use of existing knowledge (exploitation). We hypothesized that feeling trusted (untrusted) would thus increase (decrease) the level of exploration exhibited by trustees compared to the control treatment. We use a novel method of inducing felt trust and untrust and a modified version of the two-armed bandit task to measure exploratory behavior. Our preliminary analysis indicates the asymmetrical impact of trust on exploration, i.e. that feeling untrusted does significantly reduce the likelihood of exploration compared to the control, but feeling trusted does not increase exploration. We also find that feeling untrusted negatively impacts performance in this task. These effects persist after controlling for risk aversion, gender and age. Further implications of these findings and future research looking into the phenomena of felt trust and exploration are discussed.

Links

• MUNI/A/1036/2018, interní kód MU: Name: Emotions and Economic Decision Making

Investor: Masaryk University, Category A