What would you do?

My Consumer Behavior class has become in and of itself an experiment in consumer behavior. About a week and a half ago the most interesting experiment took place: The professor came into class and announced that given that he thinks the majority of our final project proposals are weak and boring, he is giving us another option for a final project which involves analysis rather than research. In his mind, this second alternative better plays to our strengths as MBA students. The problem was this: that same day was the first of two possible dates to submit the first part of the original project. Moreover, in giving the new, easier alternative, he also changed the criteria for the grading of the original project: before that project’s grade was divided between 3 “mini projects”, now, the entire grade rests on the final paper submitted.
So what do you think? Put yourself in the following situation and tell me what you would have done: Your team decided to submit the first paper on that day. During the past week each of you worked 5-8 hours on researching and writing the paper. When you come to class you find out that (a) you now have an easier option, (b) the work that you did do (that you now the professor prejudges as is poor) will not count towards your grade and (c) there is part of the class that did not do that work yet and given the new option might not have to do it.



If you are an MBA student in the US, I’m sure that it’s clear to you that the answer is 3. I’ve actually seen this happen on several occasions – something related to a project is changed in a manner that makes the project easier for everyone, and those that already put in work get pissed off, completely ignoring the fact that they can benefit from the change as well.
My initial reaction was to raise a question as to the general emotion of social solidarity among my classmates. If everyone were to choose the new option those who had already handed in the first paper in the original project had a sunk cost while other didn’t. That difference was so outrageous to those who did the work that they were willing to give up the benefit of the new option, thereby putting everyone at a disadvantage.
But there is another interesting question in this scenario, even if you don’t consider the relationship between the individual and the group – the fact that to the people who had done the initial work, the sunk cost seemed so much greater than the benefit they might get from switching to the new option. On this topic, I actually found somewhat related research done by On Amir and Dan Ariely, published in the Journal of Marketing Research (Feb 2007). Their research showed that when a rule based decision mechanism is triggered a person is more likely to make an illogical decision rather than break the rule.
The researched focused on money as a cue for triggering such rule based decision mechanism, and actually showed that effort (in their study, a longer drive) does not trigger it. However, I think that this study still is relevant here. My working theory right now is that for American MBA students, there is a rule of fairness which dictates that hard work should be rewarded while slacking off is should be punished. The events in class triggered that rule and made them irrationally prefer continuing with the original project rather than choose the second option, forsaking their own benefit from switching and completely disregarding the implication to others.
It’s a working theory, still not worded perfectly, and I still this that last part (disregarding the implication to others) is a cultural thing has to do with social solidarity. I wonder what Ariely and Amir (both Israeli Professors at American MBA programs) would think.

PS - when putting in links for this blog, I noticed that this month's JMR has an article written by 2 of my professors, one of them the professor of the aforementioned CB class.

Oh - and another think, the link to Dan Ariely is a to the TED website. he has 2 talks there, both very interesting, neither very long.