Betting the farm and playing it safe? Hyper-core self-evaluation in decisions when managers are winning and losing

Andreas Hönl, Philip Meissner () and Torsten Wulf
Additional contact information
Andreas Hönl: Philipps-University Marburg
Philip Meissner: ESCP Business School Berlin
Torsten Wulf: Philipps-University Marburg

Business Research, 2020, vol. 13, issue 3, No 17, 1293-1316

Abstract: Abstract Core self-evaluation summarizes a decision maker’s self-worth. This key personality trait has been shown to lead to extreme performance consequences of either winning or losing big. We suggest that these extreme performance outcomes may partly rest in how core self-evaluation affects executive’s perception and evaluation of risk in choices under uncertainty. We conducted a choice experiment building on the original prospect theory experiments with 97 executives, in which we measured the effect of core self-evaluation on risk behavior. As a robustness test, we replicated and validated our findings with a larger sample of 111 executives. Building on the tenets of prospect theory, we show that decision makers with high levels of core self-evaluation are less loss averse. Surprisingly, this effect differs depending on whether gains or losses are highlighted in the decision. For gains, higher levels of core self-evaluation are associated with behaviors that are closer to risk neutrality. For losses, however, we find that higher levels of core self-evaluation further enhance the risk-seeking behavior of decision makers. These findings contribute towards understanding the effects of core self-evaluation in the work environment as well as in the decision process and provide an additional lens for studying how the personality of executives affects choices under uncertainty.

Keywords: Core self-evaluation; Management; Decision making (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s40685-020-00132-y Abstract (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:busres:v:13:y:2020:i:3:d:10.1007_s40685-020-00132-y

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/40685

DOI: 10.1007/s40685-020-00132-y

Access Statistics for this article

Business Research is currently edited by Thomas Gehrig

More articles in Business Research from Springer, German Academic Association for Business Research Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().