Date of Award

Fall 2019

Degree Type

Restricted to Claremont Colleges Dissertation

Degree Name

Political Science and Economics, PhD interfield

Program

School of Social Science, Politics, and Evaluation

Advisor/Supervisor/Committee Chair

Paul Zak

Dissertation or Thesis Committee Member

Jorge Barraza

Dissertation or Thesis Committee Member

Tom Kniesner

Terms of Use & License Information

Terms of Use for work posted in Scholarship@Claremont.

Rights Information

© Copyright Rebecca Johannsen, 2019

Abstract

Foundational economic models dictate that utility is derived primarily from consumption and leisure, with work as the source of pain, opportunity cost, and annoyance. Working was traditionally viewed by economists as something people only engage in when wages more than compensate for its disutility. Despite these models, many people exert discretionary effort and enjoy the act of working. This paper looks at evidence from a nationally-representative sample of working adults, an intervention at an online retailer and a neuroeconomics experiment to quantify how organizational trust and intrinsic motivation improves outcomes for businesses and employees. Analysis of the national sample showed that organizational trust and alignment with the company's purpose are associated with higher employee incomes, longer job tenure, greater job satisfaction, less chronic stress, improved satisfaction with life, and higher productivity. Employees working the highest quartile of organizational trust had average incomes 10.3% higher those working in the middle quartile of trust (p=0.000) indicating that trust increases productivity. In order to demonstrate the causal effect of trust on business performance, we created an intervention to increase organizational trust in a division facing high job turnover at a large online retailer. We found that organizational trust increased 6% and this improved job retention by 1%. These studies show that management practices that increase organizational trust have salubrious effects on business performance. Employees with greater autonomy have been shown to be more productive and happier. Understanding why this occurs has relied to date on self-reported data in which employees may consciously or unconsciously misattribute their own causal actions. We designed a neuroeconomics experiment to investigate the mechanisms through which greater autonomy affects individual and team performance and if this had an effect on mood. Participants (N=100) were shown a three-minute video that described the productivity impact of greater autonomy at work (treatment) or the productivity benefits of work-flow management software. Electrodermal responses were captured to measure physiologic effort and were related to the video stimuli, productivity, and mood. The treatment group had a 5.2% (p=0.047) greater average productivity and 31% (p=0.000) higher positive affect during the video than the control group average. Productivity was directly related to the physiologic effort put into the task for both the treatment and control groups. The impact of physiologic effort on productivity continued to hold when controlling for participants' intrinsic motivation. We also found that individual productivity was associated with an increase in positive affect, while group productivity increased positive affect only for those in the treatment group. Our findings indicate that increased perceived autonomy can significantly improve individual and group productivity by inducing workers to put in greater effort into their tasks and that this can have a salubrious impact on mood. experiment to investigate the mechanisms through which greater autonomy affects individual and team performance and if this had an effect on mood. Participants (N=100) were shown a three-minute video that described the productivity impact of greater autonomy at work (treatment) or the productivity benefits of work-flow management software. Electrodermal responses were captured to measure physiologic effort and were related to the video stimuli, productivity, and mood. The treatment group had a 5.2% (p=0.047) greater average productivity and 31% (p=0.000) higher positive affect during the video than the control group average. Productivity was directly related to the physiologic effort put into the task for both the treatment and control groups. The impact of physiologic effort on productivity continued to hold when controlling for participants' intrinsic motivation. We also found that individual productivity was associated with an increase in positive affect, while group productivity increased positive affect only for those in the treatment group. Our findings indicate that increased perceived autonomy can significantly improve individual and group productivity by inducing workers to put in greater effort into their tasks and that this can have a salubrious impact on mood.

Available for download on Saturday, April 15, 2023

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