The mutual effects of irrationality and informal social networks on small group performance in decisional tasks

Giulia Palombi, Fabio Nonino, Stephen P. Borgatti


Few processes are important for an organization than the decisional ones. Increasing attention is received by problem-solving (an analytical process in which it must be found a way to reach a goal) and decision-making (a selection process where one of the possible solutions is chosen to reach a desired goal). As demonstrated by behavioral economics, decisions can be irrational, and, under specific inputs, this irrationality is predictable. An example of predictability of irrationality in decision making processes is explained by the theory of the Asymmetrical Dominance Effect (ADE) that occurs when a predefined choice set, composed of a target alternative and an alternative competitor (equally best choices), is augmented by a decoy option dominated by the target alternative; the preference would, in most of the cases, be the target alternative despite his “rational” equality with the competitor one (Huber et al., 1982). Another relevant example is the use of high incentives which yield the weakest individual performance in cognitive tasks when compared with the low and middle valued incentives (Arieli et al., 2009) despite the logic according to which people having the possibility of receiving them should be more motivated and work harder (Lazaer, 2000). The experiment is the elective methodology to test behavior (and his susceptibility to irrationality) during cognitive tasks. Laboratory experiments testing cognitive task-performance have been run since 1950 by scientist interested in testing the relationship between social network structure of small groups and performances (Bavelas, 1950, Levitt; 1951). Although the consequences of ADE and the use of high incentives, as well as the consequences of specific network structures on cognitive task-performance have been largely explored, the mutual effects of these factors have not been tested yet. The innovative aim of the present research is to study the mutual effects of irrationality and informal social networks on small group performance in decisional tasks. In order to accomplish our aim, we conducted two laboratory experiments on small groups having three different informal social network structures and we asked them to complete two tasks organized similarly to cards' game simulating a problem-solving job and a decision making one. Some groups were treated by irrationality-inducing elements such as the decoy alternative and high incentives. To assemble the groups, we mapped two real networks based on cognitive trust (since the tasks were cognitive) using students taking business classes at a major European university. Individuals were assigned to various kinds of 4-person groups. One type of group was a sociometric star: the central person had the maximum in-degree centrality and the group the maximum centralization value. A second type of group was a sociometric clique: in this group each participant was equal in terms of centrality and the group had the maximum density. A third type of group was an empty one: there were no ties within the group at all. We obtained 71 groups: 16 stars, 15 cliques and 40 empties. Interesting mutual effects of irrationality and informal social network on small groups’ performances in decision tasks were found.

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