Adverse macroeconomic environments undermine integrative value generation

• Main Author: SIROLA, Nina
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2018
• Subjects: Human Resources Management; Organizational Behavior and Theory
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/5969
• Institution: Singapore Management University

Recent work in the organizational literature started to investigate how individual workers respond to cues of economic downturns with the goal of helping leaders to understand, predict, and effectively manage the behavior of their workforce when difficult economic times hit. The present research examined how the cues of adverse economic times impact a fundamental economic activity–integrative value generation in business deals. Study 1 extended past work which suggested that adverse economic environments induce a more zero-sum construal of success by controlling for a potential confounding influence of individualism versus collectivism, as well as demonstrating that the effect of adverse economic environments is amplified in more collectivistic countries. Study 2 replicated these effects using experimental manipulation and also documented negative implications for integrative value generation. Taken together, these findings identify an important effect through which cues of economic downturns prompt workers to react in a way that hinders, rather than helps, organizations’ ability to cope with an unfavorable state of the economy.