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Managing with style? Micro-evidence on the allocation of managerial attention

Subject

Strategy and Entrepreneurship

Publishing details

Working Paper

Authors / Editors

Lo D; Brahm F; Dessein W; Minami C

Biographies

Publication Year

2021

Abstract

How does task expertise affect the allocation of attention? Our theory argues that when attention is scarce, expertise and attention are complements: a manager optimally focuses her attention on tasks in which she has relatively more expertise; she "manages with style." In contrast, when attention is abundant, attention and expertise become substitutes: a manager shifts her attention towards tasks she has less expertise in; she "manages against her style." Using micro-level data on managers from two unrelated companies, and employing various measures of time stress and managerial attention, we find converging and supporting evidence. A manager's attention capacity determines whether she "manages with style," or "against it." While current behavioral approaches view "managing with style" as prevalent and biased, our theory and findings suggest, instead, that it is contingent and optimal.

Keywords

Management

Series

Working Paper