The Intrinsic Value of Decision Rights

Abstract

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org. Philosophers, psychologists, and economists have long argued that certain d rights carry not only instrumental value but may also be valuable for their ow The ideas of autonomy, freedom, and liberty derive their intuitive appealpartly -from an assumed positive intrinsic value of decision rights. Providin evidence for the existence of this intrinsic value and measuring its size, how intricate. Here, we develop a method capable of achieving these goals. The dat that the large majority of our subjects intrinsically value decision rights beyond th strumental benefit. The intrinsic valuation of decision rights has potentially im consequences for corporate governance, human resource management, and o job design: it may explain why managers value power, why employees apprec with task discretion, why individuals sort into self-employment, and why the r tion of decision rights is often very difficult and cumbersome. Our method and may also prove useful in developing an empirical revealed preference foundat concepts such as "freedom of choice" and "individual autonomy."

Illusion of control and the pursuit of authority

“…Our experiment of course connects to the recent literature on preferences for control and the allocation of authority, see Falk & Kosfeld (2006), Fehr et al (2013), Bartling et al (2013), and Dominguez-Martinez, Sloof & von Siemens (2014). They find that the allocation of power as such affects behavior.…”

“…This suggests that at least some people value decision rights beyond their purely instrumental value. Fehr, Herz & Wilkening (2013), Bartling, Fehr & Herz (2013) and Owens, Grossman & Fackler (forthcoming) indeed find that a significant fraction of their experimental subjects intrinsically value authority and control.…”

Delegation with a Reciprocal Agent

“…9 In addition, we assume that the 8 The payoff the principal attains when she assigns a standard task to the agent may also include the intrinsic value that she attaches to holding the decision right. The existence of a taste for control has recently found support in experimental research Bartling et al, 2014).…”

Decision Initiation, Decision Implementation, and the Allocation of Decision Rights

“…How decision authority is employed is then only secondary. Frey, Benz & Stutzer (2004) indeed argue that some people enjoy decision autonomy, and Benz & Frey (2008), Fuchs-Schündeln (2009), Bartling, Fehr & Herz (2013), and Owens, Grossman & Fackler (2014) provide empirical evidence for such preferences for decision autonomy. To isolate the importance of social preferences -no matter whether distributional or reciprocal concerns -for the allocation of authority, we conduct an experiment in which potential implementation problems never occur and are thus irrelevant if subjects are selfish in the sense that they maximize their own monetary payo↵s.…”