Behavioral Assumptions and Management Ability: A Tentative Test

Benito Arruñada () and Xosé H. Vázquez

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: The paper explores the consequences that relying on different behavioral assumptions in training managers may have on their future performance. We argue that training with an emphasis on the standard assumptions used in economics (rationality and self-interest) leads future managers to rely excessively on rational and explicit safeguarding, crowding out instinctive contractual heuristics and signaling a ‘bad’ type to potential partners. In contrast, human assumptions used in management theories, because of their diverse, implicit and even contradictory nature, do not conflict with the innate set of cooperative tools and may provide a good training ground for such tools. We present tentative confirmatory evidence by examining how the weight given to behavioral assumptions in the core courses of the top 100 business schools influences the average salaries of their MBA graduates. Controlling for the average quality of their students and some other schools’ characteristics, average salaries are significantly greater for those schools whose core MBA courses contain a higher proportion of management courses as opposed to courses based on economics or technical disciplines.

Keywords: Evolutionary psychology; economics; management; contractual heuristics; rationality; self-interest (search for similar items in EconPapers)
JEL-codes: A23 B41 D01 D87 M12 M51 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cbe, nep-edu, nep-evo and nep-soc
Date: 2009-06
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Persistent link: http://EconPapers.repec.org/RePEc:upf:upfgen:1157

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