Media Releases

Choosing less a form of protection says new study on decision-making

April 3, 2013

TORONTO, ON – Imag­ine you have a choice to make.

In one sce­nario, you’d get $8 and some­body else — a stranger – would get $8 too. In the oth­er, you’d get $10; the stranger would get $12.

Econ­o­mists typ­i­cal­ly assume you’d go for the $10/$12 option because of the belief that peo­ple try to max­i­mize their own gains. Choos­ing the oth­er sce­nario would just be irra­tional.

But new research con­duct­ed in col­lab­o­ra­tion with a pro­fes­sor at the Uni­ver­si­ty of Toronto’s Rot­man School of Man­age­ment shows that if a per­son is feel­ing threat­ened, or con­cerned with their sta­tus, they are more like­ly to choose the option that gives them less. And although this choice might seem irra­tional from an eco­nom­ic per­spec­tive, this choice sat­is­fies an impor­tant psy­cho­log­i­cal need.

Peo­ple who do this, “have a rea­son for their behav­iour, and that rea­son is to pro­tect them­selves from low sta­tus,” described as a low posi­tion or rank in rela­tion to oth­ers, says Prof. Geof­frey Leonardel­li, who co-wrote the paper with Vanes­sa Bohns from the Uni­ver­si­ty of Water­loo and Jun Gu from Australia’s Monash Uni­ver­si­ty.

Through a series of exper­i­ments, the researchers found that peo­ple who showed a sys­tem­at­ic pref­er­ence for “rel­a­tive out­comes” (eco­nom­ic pay­offs which gave them the same as or more than oth­ers) had a focus on secu­ri­ty and sought to pro­tect them­selves from being assigned to a low­er posi­tion or rank. But those who looked for “absolute” out­comes (over­all val­ue) had a “growth” focus, one that goes after max­i­mum pos­i­tive results.

Jun Gu, the lead author of the research, not­ed that “Peo­ple with a secu­ri­ty focus also tend to walk away from eco­nom­ic deals that sug­gest they have low sta­tus, even if walk­ing away means earn­ing less mon­ey than they could have.”

In one exper­i­ment, par­tic­i­pants were offered $1 but were also told that the par­ty mak­ing the offer would get $9.  Even though they would have pock­et­ed an addi­tion­al $1, some 48% of those with a secu­ri­ty focus reject­ed the offer, where­as only 17% of those with a growth focus turned the offer down.

Pre­vi­ous research by Prof. Leonardel­li and his col­lab­o­ra­tors has shown that, in nego­ti­a­tions, those with a growth focus  tend to set high­er goals, are more aggres­sive in their nego­ti­at­ing, and ulti­mate­ly attain bet­ter gains for all those involved.

“Peo­ple with a growth focus appear to more eas­i­ly move back and forth between coop­er­a­tion and com­pe­ti­tion,” because they have no spe­cial fears or con­cerns about their own secu­ri­ty, says Prof. Leonardel­li.

If gov­ern­ments want to pur­sue eco­nom­ic poli­cies that pro­mote growth, the study’s find­ings sug­gest peo­ple first need to feel secure enough to sup­port and par­tic­i­pate in those poli­cies, says Prof. Leonardel­li.

Prof. Leonardel­li is one of the fac­ul­ty for the new Rot­man Exec­u­tive Lead­er­ship Pro­gram, a high­ly per­son­al­ized lead­er­ship devel­op­ment pro­gram for senior lev­el man­agers. Com­plete details on the pro­gram are online at

For the lat­est think­ing on busi­ness, man­age­ment and eco­nom­ics from the Rot­man School of Man­age­ment, vis­it

The Rot­man School of Man­age­ment at the Uni­ver­si­ty of Toron­to is redesign­ing busi­ness edu­ca­tion for the 21st cen­tu­ry with a cur­ricu­lum based on Inte­gra­tive Think­ing. Locat­ed in the world’s most diverse city, the Rot­man School fos­ters a new way to think that enables the design of cre­ative busi­ness solu­tions.  The School is cur­rent­ly rais­ing $200 mil­lion to ensure Cana­da has the world-class busi­ness school it deserves. For more infor­ma­tion, vis­it


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Ken McGuf­fin
Man­ag­er, Media Rela­tions
Rot­man School of Man­age­ment
Uni­ver­si­ty of Toron­to
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