Escalation Revisited: Investigating the Influence of Personality and Organizational Support on Escalation of Commitment

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Escalation Revisited: Investigating the Influence of Personality and Organizational Support on Escalation of Commitment Escalation Revisited: Investigating the Influence of Personality and Organizational Support on Escalation of Commitment by Julia Walsh Howell A dissertation submitted to the Graduate Faculty of Auburn University in partial fulfillment of the requirements for the Degree of Doctor of Philosophy Auburn, Alabama August 2, 2014 Keywords: Escalation of commitment, personality, organizational support, sunk costs Copyright 2014 by Julia Walsh Howell Approved by Daniel Svyantek, Chair, Professor and Chair, Department of Psychology Ana Franco-Watkins, Associate Professor, Department of Psychology Alejandro Lazarte, Associate Professor, Department of Psychology Alan Walker, Associate Professor, Department of Management Abstract Escalation of commitment research has been narrow in its scope of influencing factors. A goal of this study was to remedy this gap by including factors at the individual, organizational, and decision context level that affect escalation. Furthermore, to my knowledge there is no other escalation research that has included both an economic and a human resources (HR) decision scenario. A significant contribution of this study was the results showing these two types of scenarios have different, and sometimes opposing, outcomes. In the economic context, sunk costs were positively related to escalation, but the relationship was inversed in the HR context. Additionally, facets of neuroticism and openness to experience were related to escalation in the economic context, but no such relationships were present in the HR context. Openness to experience moderated the relationship between organizational support and escalation. The results in the HR context have practical implications regarding how managers select, train, promote, and terminate employees. Furthermore, the differential outcomes in the economic and HR contexts provide a first step in expanding the theoretical implications of varying contexts and their influence on escalation. ii Acknowledgments Thank you to my mom and dad. I share this accomplishment with you and I am proud to be your daughter! Thank you to my little sister, Jackie, for inspiring me with your work ethic and providing encouragement along the way. Thank you to my advisor, Dan, for your wisdom and guidance through this process. And finally, thank you to my amazing husband and best friend, Josh. Your love and constant support gave me the confidence to finish this. I am forever indebted to you. iii Table of Contents Escalation of Commitment ......................................................................................................... 1 Three lines of escalation research. .......................................................................................... 4 Auction studies.................................................................................................................... 4 Theoretical models. ............................................................................................................... 11 Influential escalation studies ................................................................................................. 13 Escalation Situations ................................................................................................................. 16 Decision context: Sunk costs and level of completion ......................................................... 17 Organizational support: Strong and weak situations. ....................................................... 17 Individual Differences .............................................................................................................. 19 Personality: Conscientiousness, neuroticism, openness to experience, escalation susceptibility, and risk-taking. .............................................................................................. 20 Organizational Support × Personality Interaction ................................................................ 24 Method .......................................................................................................................................... 26 Participants ................................................................................................................................ 26 Design ....................................................................................................................................... 26 Economic decision task......................................................................................................... 26 HR decision task. .................................................................................................................. 27 Materials ................................................................................................................................... 28 Control variables ................................................................................................................... 28 Independent variables ........................................................................................................... 29 Sunk costs ......................................................................................................................... 29 Completion ........................................................................................................................ 29 Passing probability ............................................................................................................ 29 Organizational support ...................................................................................................... 29 Predictor variables ................................................................................................................ 30 Personality......................................................................................................................... 30 Escalation susceptibility.................................................................................................... 32 Risk-taking ........................................................................................................................ 33 Dependent variable ............................................................................................................... 34 iv Manipulation checks ............................................................................................................. 34 Procedure .................................................................................................................................. 35 Results ........................................................................................................................................... 35 Control Variables ...................................................................................................................... 36 Perceived likelihood of success ............................................................................................ 36 Perceived threat of competition ............................................................................................ 37 Test of Hypotheses .................................................................................................................... 38 Independent variables ........................................................................................................... 38 Hypothesis 1...................................................................................................................... 38 Hypothesis 2...................................................................................................................... 38 Hypothesis 3...................................................................................................................... 38 Individual difference variables ............................................................................................. 39 Hypothesis 4...................................................................................................................... 39 Hypothesis 5...................................................................................................................... 39 Hypothesis 6...................................................................................................................... 40 Hypothesis 7...................................................................................................................... 40 Hypothesis 8...................................................................................................................... 40 Interactional hypotheses........................................................................................................ 41 Hypothesis 9a .................................................................................................................... 42 Hypothesis 9b.................................................................................................................... 43 Hypothesis 9c .................................................................................................................... 43 Manipulation Checks ................................................................................................................ 44 Sunk costs ............................................................................................................................. 44 Completion ............................................................................................................................ 45 Level of escalation ...............................................................................................................
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