Competitive Escalation
In this paper, the authors describe a set of studies investigating factors that might reduce the tendency to engage in competitive escalation. The particular setting in which this is studied is a dollar auction. They find that direct experience with the dollar auction reduces competitive escalation in a subsequent auction. A different type of auction does not have the same effect. Managerial experience does not completely remove the effect either. Even goal setting fails to provide an adequate prophylactic.
I found this paper to be very intriguing. The topic is clearly important, because competitive escalation can drive people and organizations to take miserably suboptimal actions. Finding ways of helping people avoid these actions is a …show more content…
However, the claims that the paper makes about establishing a role for the hot-cold empathy gap go beyond what the empirical results can support. The authors point to the fact that goal setting did not substantially reduce bids in the dollar auction as supportive of a role for the hot-cold empathy gap. I agree that this is consistent with the idea that arousal or emotion played a role in fueling the escalation of bids. However, I don’t think that this is directly supportive evidence. There are other reasons why goal setting may have failed. Perhaps the most direct evidence that the authors point to are quotes from participants’ comments that were collected at the end of the studies. The comments that the authors quoted are very specific to the role of arousal and stress. Unfortunately, the paper provides no indication of how these comments were solicited, whether they were analyzed quantitatively, and what the results of those quantitative analyses look like. As much as I like the speculation about the hot-cold empathy gap and the role of arousal, if this paper is really going to make a strong contribution about this point, the empirical work needs to be more specifically tied to that …show more content…
Nothing was said about power analyses. To detect a medium-sized effect in a 2-cell, between-subjects design at 80% power, a researcher needs 128 participants (64 per cell). Perhaps the authors assume that the effect sizes in their studies would be massive, which could justify having lower sample sizes. However, it is striking just how low the sample sizes are. Because groups are the appropriate units of analysis, the functional sample size in Study 1 is 14. That is, there were 14 groups being tested. With an N of 14, drawing conclusions from inferential statistics becomes challenging, especially in the case of nonsignificant differences. Experiment 1B, which involved managers, included only 28 participants divided into seven groups. The evidence that the managers overbid and exhibited competitive escalation is pretty clear, but the authors then compared the results of that study to results from a part of Experiment 1a. Because the difference was nonsignificant, the authors concluded that “managerial experience is not sufficient to avert destructive consequences in a new competitive escalation situation.” From this comparison, it’s not appropriate to conclude that managerial experience doesn’t matter or wouldn’t matter for reducing the extent of competitive escalation. There are just too few participants to draw any meaningful conclus about how small the effect of managerial experience generally
I found this paper to be very intriguing. The topic is clearly important, because competitive escalation can drive people and organizations to take miserably suboptimal actions. Finding ways of helping people avoid these actions is a …show more content…
However, the claims that the paper makes about establishing a role for the hot-cold empathy gap go beyond what the empirical results can support. The authors point to the fact that goal setting did not substantially reduce bids in the dollar auction as supportive of a role for the hot-cold empathy gap. I agree that this is consistent with the idea that arousal or emotion played a role in fueling the escalation of bids. However, I don’t think that this is directly supportive evidence. There are other reasons why goal setting may have failed. Perhaps the most direct evidence that the authors point to are quotes from participants’ comments that were collected at the end of the studies. The comments that the authors quoted are very specific to the role of arousal and stress. Unfortunately, the paper provides no indication of how these comments were solicited, whether they were analyzed quantitatively, and what the results of those quantitative analyses look like. As much as I like the speculation about the hot-cold empathy gap and the role of arousal, if this paper is really going to make a strong contribution about this point, the empirical work needs to be more specifically tied to that …show more content…
Nothing was said about power analyses. To detect a medium-sized effect in a 2-cell, between-subjects design at 80% power, a researcher needs 128 participants (64 per cell). Perhaps the authors assume that the effect sizes in their studies would be massive, which could justify having lower sample sizes. However, it is striking just how low the sample sizes are. Because groups are the appropriate units of analysis, the functional sample size in Study 1 is 14. That is, there were 14 groups being tested. With an N of 14, drawing conclusions from inferential statistics becomes challenging, especially in the case of nonsignificant differences. Experiment 1B, which involved managers, included only 28 participants divided into seven groups. The evidence that the managers overbid and exhibited competitive escalation is pretty clear, but the authors then compared the results of that study to results from a part of Experiment 1a. Because the difference was nonsignificant, the authors concluded that “managerial experience is not sufficient to avert destructive consequences in a new competitive escalation situation.” From this comparison, it’s not appropriate to conclude that managerial experience doesn’t matter or wouldn’t matter for reducing the extent of competitive escalation. There are just too few participants to draw any meaningful conclus about how small the effect of managerial experience generally