If you’re working yourself to the bone, have you ever questioned why you’re doing so? According to research by INSEAD faculty, overwork could be less about ambition than childhood psychology. Individuals who suffer from such distress may be trapped in a cycle that both generates and sustains distress through relentless doing.

This is one of the findings highlighted in this month’s INSEAD research round-up. Other insights include why hedonistic satisfaction is more resilient to disappointment than we might expect, and how organisations can centralise in a crisis without betraying their decentralising principles. 

INSEAD faculty also found that when securities regulators in the United States stop watching, insiders start trading. Finally, measures of implicit bias predict discriminatory behaviour, but not nearly as well as simply asking people about their attitudes. 

Overworked? Your childhood may be the reason

Why do some people work as if their life depended on it? Through an in-depth study of knowledge workers who overwork, Jennifer Petriglieri and PhD student Preeti Varma developed a model showing how identity defences create and sustain workplace distress. They found that excessive work is rooted in a "doer identity": a sense of self built around doing, formed in childhood in response to caregivers' excessive demands. 

The authors identified three distinct narratives of distress centred on self-worth, safety or recognition. In each case, the doer identity acts as a "false self” defence that worked in childhood but becomes counterproductive in working life, generating different emotional experiences and ways of relating to colleagues that reproduce or worsen distress rather than relieving it.

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Why we're often not as disappointed as we should be

We’ve all been underwhelmed by that fancy restaurant that didn’t quite live up to our expectations – or online reviews. But have you considered that in between choosing that restaurant and actually dining there, you might have formed expectations that affected how dissatisfied you ultimately felt? Manuel Sosa and his co-authors came up with a framework for estimating quality references and their effect on choice and outcome, which can include consumers' own past experiences and those of others.

Using data from online restaurant reviews, they found evidence of quality loss aversion, whereby the psychological pain of a product failing to meet expectations feels more intense than the joy of it exceeding them, when people are choosing what to consume. However, consumers’ satisfaction drops much less than expected when they experience a subpar “good” (i.e. going to a lower-quality restaurant). This indicates that consumers adjust their expectations downwards upon experiencing a “good” below their reference point. The authors’ findings suggest that alternating between high- and low-quality options may produce better outcomes than consistently pursuing the highest quality.

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Do implicit bias tests actually predict discriminatory behaviour?

The idea that racial prejudice contributes to discrimination not just deliberately but also automatically has long been a major focus of social psychology. Much of the evidence relies on indirect measures of implicit attitudes, but studies have produced conflicting estimates of how well these actually predict behaviour. 

Eric Luis Uhlmann and his fellow researchers tested implicit racial attitude measures against discriminatory behaviour in a sample of more than 2,000 White Americans. They found that indirect measures do correlate with discriminatory behaviour, but that this only explained around 2.5% of variance beyond self-reported attitudes. Self-report measures proved far stronger, explaining around 45% of variance. The authors acknowledge the results support both optimistic and pessimistic readings, and call for further collaborative research into how well implicit attitude measures generalise to real-world organisational settings.

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How decentralised organisations can centralise without losing trust

Organisations committed to decentralised authority sometimes face situations, such as the Covid-19 crisis, where centralised decision-making becomes necessary. But centralising risks undermining employees' trust, damaging motivation and threatening organisational legitimacy. Using a comparative case study of four organisations that had explicitly committed to decentralisation and then centralised during the pandemic, Michael Y. Lee and his co-author identified how organisations can temporarily deviate from decentralisation without abandoning it.

In three of the cases, leaders and workers collectively authorised centralisation, enacted it transparently, and thereafter preserved decentralisation commitments. The remaining case saw leaders decide on centralisation unilaterally and carrying it out in an opaque manner, thus undermining decentralisation commitments. The findings challenge the assumption that decentralisation is inherently fragile, and suggest how organisations can uphold shared commitments even under pressure.

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When the regulator goes away, insiders trade

Daniel A. Bens, Gavin Cassar, Thomas Keusch and their co-author used a shutdown of the US government as a natural experiment to test whether reduced regulatory scrutiny affects insider trading. Their analysis shows that insiders earned abnormal profits during the shutdown, when the Securities and Exchange Commission (SEC) largely ceased working for one month, and this finding held across different control periods and comparison groups. Notably, the abnormal trading began approximately one week into the shutdown, suggesting insiders first took time to gauge how long and disruptive the shutdown would be.

The study also finds that SEC enforcement activity, including investigations, enforcement releases and comment letters, declined not just during the shutdown but failed to fully recover afterwards. The findings contribute to the literature on insider trading enforcement and highlight the broader economic consequences of regulatory disruption in a politically divided environment.

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