Given the increasing application of cutback strategies in the workplace, and an underlying need to understand explanatory process at work, we investigated the effects of one cutback strategy to deal with economic uncertainty-furloughs. Equity theory and social exchange theory guided our predictions in explaining the mechanisms through which furloughs affect turnover intentions. Quantitative data collected at two time periods during the "Great Recession", after cutbacks were announced and implemented, provided evidence that assessments of psychological contract breach and work overload affect the relationship between furlough experience and turnover intentions. To investigate how the additional stressors of a pandemic affected the proposed model, a follow-up content analysis of employee discussions around cutback policies during the COVID-19 pandemic was conducted. This analysis provided support for the model, and also identifies several additional themes brought on by the pandemic (trust, and health and safety), with many employees exhibiting feelings of anxiety and fear around cutback policies and the status of their employment in general. Our results have implications for many organizational cutback initiatives, including salary reductions and decreased organizational resources, that are implemented during times of crisis. Organizations struggle to sustain productivity during an economic downturn, when uncertainty surrounds short-and near-term demand. In 2008, this was pronounced during the great recession, and again in 2020 this became relevant for business leaders dealing with the closure or slowdown of their businesses due to the COVID-19 crisis. As payroll expense is often the largest item on
The present research sought to examine the impact of narcissism, prediction accuracy, and should counterfactual thinking—which includes thoughts such as “I should have done something different”—on hindsight bias (the tendency to exaggerate in hindsight what one knew in foresight) and perceived learning. To test these effects, we conducted four studies (total n = 727). First, in Study 1 we examined a moderated mediation model, in which should counterfactual thinking mediates the relation between narcissism and hindsight bias, and this mediation is moderated by prediction accuracy such that the relationship is negative when predictions are accurate and positive when predictions are inaccurate after accurate predictions. Second, in Study 2 we examined a moderated sequential mediation model, in which the relation between narcissism and perceived learning is sequentially mediated through should counterfactual thinking and hindsight bias, and importantly, this sequential mediation is moderated by prediction accuracy. In Study 3 we ruled out could counterfactual thinking as an alternative explanation for the relationship between narcissism and hindsight bias. Finally, by manipulating should counterfactual thinking in Study 4, our findings suggest that this type of thinking has a causal effect on hindsight bias. We discuss why exhibiting some hindsight bias can be positive after failure. We also discuss implications for eliciting should counterfactual thinking. Our results help explain why narcissists may fail to learn from their experiences.
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