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How Does Status Affect Performance? Status as an Asset vs. Status as a Liability in the PGA and NASCAR

Author

Listed:
  • Matthew S. Bothner

    () (ESMT European School of Management and Technology, 10178 Berlin, Germany)

  • Young-Kyu Kim

    () (Korea University, Seongbuk-gu, Seoul 136-701, Korea)

  • Edward Bishop Smith

    () (Ross School of Business, University of Michigan, Ann Arbor, Michigan 48109)

Abstract

Two competing predictions about the effect of status on performance appear in the organizational theory and sociological literatures. On one hand, various researchers have asserted that status improves performance. This line of work emphasizes tangible and intangible resources that accrue to occupants of high-status positions and therefore pictures status as an asset. On the other hand, a second stream of research argues that status instead diminishes performance. This alternative line of work emphasizes complacency and distraction as deleterious processes that plague occupants of high-status positions and thus portrays status as a liability. Which of these two perspectives best characterizes the actual performance of individuals in a competitive setting? And are they in any way reconcilable? In this paper, we summarize these two perspectives and test them in two empirical settings: the Professional Golf Association (PGA) and the National Association for Stock Car Auto Racing (NASCAR). Using panel data on the PGA Tour, we model golfers' strokes from par in each competition as a function of their status in the sport. Using similar data on NASCAR's Winston Cup Series, we model drivers' speed in the qualifying round as a function of their status in the sport. We find curvilinear effects of status in both contexts. Performance improves with status until a very high level of status is reached, after which performance wanes. This result not only concurs with the view that status brings tangible and intangible resources but also provides empirical support for the contention that status fosters dispositions and behaviors that ultimately erode performance.

Suggested Citation

  • Matthew S. Bothner & Young-Kyu Kim & Edward Bishop Smith, 2012. "How Does Status Affect Performance? Status as an Asset vs. Status as a Liability in the PGA and NASCAR," Organization Science, INFORMS, vol. 23(2), pages 416-433, April.
  • Handle: RePEc:inm:ororsc:v:23:y:2012:i:2:p:416-433
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    File URL: http://dx.doi.org/10.1287/orsc.1110.0679
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    References listed on IDEAS

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    1. Podolny, Joel M & Phillips, Damon J, 1996. "The Dynamics of Organizational Status," Industrial and Corporate Change, Oxford University Press, vol. 5(2), pages 453-471.
    2. Matthew S. Bothner & Joel M. Podolny & Edward Bishop Smith, 2011. "Organizing Contests for Status: The Matthew Effect vs. the Mark Effect," Management Science, INFORMS, vol. 57(3), pages 439-457, March.
    3. Oded Stark & J. Taylor, 1989. "Relative deprivation and international migration oded stark," Demography, Springer;Population Association of America (PAA), vol. 26(1), pages 1-14, February.
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    5. Peter Von Allmen, 2001. "Is the Reward System in NASCAR Efficient?," Journal of Sports Economics, , vol. 2(1), pages 62-79, February.
    6. Podsakoff, Philip M. & Farh, Jiing-Lih, 1989. "Effects of feedback sign and credibility on goal setting and task performance," Organizational Behavior and Human Decision Processes, Elsevier, vol. 44(1), pages 45-67, August.
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    Citations

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    Cited by:

    1. repec:eee:respol:v:47:y:2018:i:9:p:1655-1673 is not listed on IDEAS
    2. repec:bla:stratm:v:38:y:2017:i:6:p:1232-1252 is not listed on IDEAS
    3. Ya-Ru Chen & Randall S. Peterson & Damon J. Phillips & Joel M. Podolny & Cecilia L. Ridgeway, 2012. "Introduction to the Special Issue: Bringing Status to the Table—Attaining, Maintaining, and Experiencing Status in Organizations and Markets," Organization Science, INFORMS, vol. 23(2), pages 299-307, April.
    4. Rui Shen & Yi Tang & Guoli Chen, 2014. "When the role fits: How firm status differentials affect corporate takeovers," Strategic Management Journal, Wiley Blackwell, vol. 35(13), pages 2012-2030, December.
    5. H Emre Yildiz & Carl F Fey, 2016. "Are the extent and effect of psychic distance perceptions symmetrical in cross-border M&As? Evidence from a two-country study," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 47(7), pages 830-857, September.
    6. repec:bla:stratm:v:38:y:2017:i:7:p:1455-1477 is not listed on IDEAS
    7. Edward Bishop Smith & Yuan Hou, 2015. "Redundant Heterogeneity and Group Performance," Organization Science, INFORMS, vol. 26(1), pages 37-51, February.
    8. Fabio Fonti & Massimo Maoret, 2016. "The direct and indirect effects of core and peripheral social capital on organizational performance," Post-Print hal-01478950, HAL.
    9. Wang, Pengfei, 2017. "Syndication and Foreignness: Venture Capital Investments in Emerging and Developed Markets," Journal of International Management, Elsevier, vol. 23(1), pages 1-15.
    10. Michael Jensen & Heeyon Kim, 2015. "The Real Oscar Curse: The Negative Consequences of Positive Status Shifts," Organization Science, INFORMS, vol. 26(1), pages 1-21, February.
    11. repec:bla:jomstd:v:54:y:2017:i:1:p:1-31 is not listed on IDEAS

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