Price and Quality Decisions by Self-Serving Managers

Daniel Halbheer, Marco Bertini and Oded Koenigsberg

No 1142, HEC Research Papers Series from HEC Paris

Abstract: This research studies the possibility that managers attribute firm performance to price and quality decisions in a self-serving manner: they tend to credit success in the market to the product characteristic that matches the commercial orientation of the business, but blame failure on the other. The problem with this reasoning is that managers then carry out adjustments based on biased information, which is suboptimal. The paper first models the phenomenon to clarify the cost of self-serving attributions to a firm. It then reports experiments that provide empirical support for the theory.

Keywords: Causal inference; self-serving bias; managerial decision-making (search for similar items in EconPapers)
Pages: 39 pages
Date: 2016-03-20
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Journal Article: Price and quality decisions by self-serving managers (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:ebg:heccah:1142

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