The Cognitive Blind Spot in Management: Antecedents and Consequences of the Dunning–Kruger Effect in Agricultural Businesses

The Dunning-Kruger effect (DKE) is an infamous illusory superiority cognitive bias in which people who perform poorly at certain tasks erroneously perceive their performance to be superior to that of others. Despite being a metacognitive phenomenon with implications for businesses, it has yet to be directly investigated in relation to managers' problem-solving and thinking skills. As managers are the first authority on their experience with the DKE in business, this study bridges the research gap through a qualitative exploration of the phenomenon, drawing on 20 semi-structured interviews with managers in agricultural businesses. We present a conceptual framework that highlights the antecedents, consequences, exacerbators, and mitigators of DKE in businesses, based on our content analysis. The double burden and ego were the most prominent antecedents to the overconfidence aspect of the DKE. Conversely, the perception that being skilled is common and fear of failure were found to be the most frequently mentioned precursors of the underestimation facet of the DKE. These antecedents mostly lead to jumping to conclusions, reduced productivity, and overcautiousness in decision-making, respectively. We also found that lack of exposure, among other factors, exacerbated the manifestation and consequences of the phenomenon. Conversely, education and training are primary mitigators of cognitive bias. Overall, our findings underscore the multifaceted nature of DKE in businesses. The DKE's impact may be reliant on certain contextual factors. Although it is apparent that the DKE mostly exhibits unfounded confidence in skills, this phenomenon has another side. Our findings show that in some contexts, under-confidence in abilities is also a prevalent manifestation of the DKE. We go on to prove that the DKE is present on all three levels of management. However, it seems that lower-level managers are more susceptible to cognitive bias.