The Ripple Effect of Managerial Behavior: Exploring Post-experimental Impact of Leading by Example on Small Firms' Cooperation and Performance.

Cooperation between employees in a company is an important input to firm performance. This study examines how a manager's cooperative behavior and the visibility of this behavior affect the cooperation amongst employees, and subsequently firm performance. To do so, we conducted a field experiment with managers and their employees from 320 Vietnamese small and micro firms to determine the impact of a manager's leading by example (LBE) on employees' behavior, corporate culture, and firm performance. Both managers and employees participated in a Public Good experiment which aimed to elicit an individual cooperative behavior. Noteworthy is that the decision made by a manager in the experiment was given as an example to employees before they made decision in that same experiment. We considered that the example of cooperation by managers in the Public Good experiment communicated a powerful signal to the employees regarding the importance of fostering cooperation in the workplace. Such a signal by the manager, who is at the top in the organizational hierarchy, would impact their employees' behavior in the workplace and firm's outcomes beyond the experiment. Interestingly, we found that concealing a manager's identity from their employees enhances the impacts of LBE.

Linking Trait Affectivity, Cognitive Ability, and Preferences Among Top Managers: Insights From a Lab-In-The-Field Experiment.

Even though there has been increasing interest in the role of cognition in leadership and in identifying the personality traits of effective leaders, there is a paucity of studies that investigate the unique influence of managers' trait affectivity and cognitive ability on their different risk and time preferences. This paper investigates the role of managers' trait affectivity and cognitive ability in their loss aversion and present bias among 623 top managers at textile and garment firms in Vietnam. We combine data on preferences elicited through a lab-in-the-field experiment with survey data. We find that managers with high positive affectivity (PA) or cognitive ability are less subject to loss aversion and present bias. In contrast, a manager with high negative affectivity (NA) is more likely to be impatient and loss averse. Furthermore, heterogeneity of trait affectivity and cognitive ability determines different loss aversion and present bias levels of managers in SMEs vis-à-vis their counterparts in large firms. Remarkably, we observe striking evidence that trait affectivity and cognitive ability significantly affect loss aversion and present bias levels of managers who were born during the Vietnam War. Still, it is not the story of their counterparts born after the Vietnam War. The results of our study are expected to provide valuable information regarding the role played by trait affectivity and cognitive ability in determining managers' loss aversion and present bias in different pathways.