A Naturalistic Foundation for the Hierarchy?

25 November 2012 at 4:50 am 3 comments

| Nicolai Foss |

In economics, the hierarchical firm arises for reasons related to economizing with transaction costs, managerial attention allocation, information synthesis and what not. Many organizational economists would argue that absent transaction costs, there would be no hierarchies as there would be no firms. But, what if the existence of hierarchy has a partly genetic basis, that is, humans evolved in such a way that they have come to “like” hierarchies (which may therefore exist even if transaction costs were zero)?  After all, those small hunting bands roaming the African savannahs 30, 000 years ago likely had leaders, a division of labor and so on, and evolutionary anthropology suggests that our brains evolved to handle the intricacies of handling this division of labor. Thus, we may be “hardwired for hierarchy.”

OK, speculation to be sure, but in “The Fluency of the Social Hierarchy: The Ease With Which Hierarchical Relationships Are Seen, Remembered, Learned, and Liked,” recently published in the prestigious Journal of Personality and Social Psychology, Emily Zitek and Larissa Tiedens provide some potentially supportive evidence: In five studies, they show that hierarchies are perceived, understood, remembered and learner faster and more efficiently than other kinds of social relationships. 

There may be many reasons for this finding, but one is the simple one that hierarchical superiors have potentially strong influence on our lives.  Very apropos, another recent study, “The hierarchical face: higher rankings lead to less cooperative looks,” by four UMichigan psychologists, finds that the “higher ranked an individual’s group is, the less cooperative the facial expression of that person is judged to be.” Interestingly, one of their settings is interaction with deans!

Abstracts below.

The Fluency of Social Hierarchy

We tested the hypothesis that social hierarchies are fluent social stimuli; that is, they are processed more easily and therefore liked better than less hierarchical stimuli. In Study 1, pairs of people in a hierarchy based on facial dominance were identified faster than pairs of people equal in their facial dominance. In Study 2, a diagram representing hierarchy was memorized more quickly than a diagram representing equality or a comparison diagram. This faster processing led the hierarchy diagram to be liked more than the equality diagram. In Study 3, participants were best able to learn a set of relationships that represented hierarchy (asymmetry of power)–compared to relationships in which there was asymmetry of friendliness, or compared to relationships in which there was symmetry–and this processing ease led them to like the hierarchy the most. In Study 4, participants found it easier to make decisions about a company that was more hierarchical and thus thought the hierarchical organization had more positive qualities. In Study 5, familiarity as a basis for the fluency of hierarchy was demonstrated by showing greater fluency for male than female hierarchies. This study also showed that when social relationships are difficult to learn, people’s preference for hierarchy increases. Taken together, these results suggest one reason people might like hierarchies–hierarchies are easy to process. This fluency for social hierarchies might contribute to the construction and maintenance of hierarchies.

The Hierarchical Face

In 3 studies, we tested the hypothesis that the higher ranked an individual’s group is, the less cooperative the facial expression of that person is judged to be. Study 1 established this effect among business school deans, with observers rating individuals from higher ranked schools as appearing less cooperative, despite lacking prior knowledge of the latters’ actual rankings. Study 2 then experimentally manipulated ranking, showing that the effect of rankings on facial expressions is driven by context rather than by individual differences per se. Finally, Study 3 demonstrated that the repercussions of this effect extend beyond the perception of cooperativeness to tangible behavioral outcomes in social interactions. Theoretical and practical implications of this phenomenon are discussed.

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3 Comments Add your own

  • 1. Recomendaciones « intelib  |  25 November 2012 at 6:45 am

    [...] A Naturalistic Foundation for the Hierarchy?, by Nicolai Foss [...]

  • 2. Cook, Michael L.  |  25 November 2012 at 11:29 am

    Thanks for this interesting post. mlc

  • 3. Bo  |  26 November 2012 at 9:36 am

    Very interesting indeed, though you may expect proponents of transaction costs to argue that we are simply hard-wired for…perceiving (and thus dealing with) transaction costs. The fact that people prefer hierarchy seems (based on the findings of the article you cite) to have a lot to do with easy of processing, recognizability, familiarity etc – all things that serve to reduce potential transaction costs associated with decision-making.

    Essentially, humans are lazy, extremely bounded rational and always on the lookout for shortcuts and easy solutions and these cognitive processing limitations leads us to prefer structure (i.e. hierarchy).

    Related (I think)…studies, in which people’s faces were rated for their level of attractiveness and health, found that the highest ratings were given to individuals with symmetrical faces. Bilateral symmetry has been found an important indicator of freedom from disease, and worthiness for mating…Nature favors symmetry (and hierarchy) because it is a winning concept..

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Nicolai J. Foss and Peter G. Klein, Organizing Entrepreneurial Judgment: A New Approach to the Firm (Cambridge University Press, 2012).
Peter G. Klein and Micheal E. Sykuta, eds., The Elgar Companion to Transaction Cost Economics (Edward Elgar, 2010).
Peter G. Klein, The Capitalist and the Entrepreneur: Essays on Organizations and Markets (Mises Institute, 2010).
Richard N. Langlois, The Dynamics of Industrial Capitalism: Schumpeter, Chandler, and the New Economy (Routledge, 2007).
Nicolai J. Foss, Strategy, Economic Organization, and the Knowledge Economy: The Coordination of Firms and Resources (Oxford University Press, 2005).
Raghu Garud, Arun Kumaraswamy, and Richard N. Langlois, eds., Managing in the Modular Age: Architectures, Networks and Organizations (Blackwell, 2003).
Nicolai J. Foss and Peter G. Klein, eds., Entrepreneurship and the Firm: Austrian Perspectives on Economic Organization (Elgar, 2002).
Nicolai J. Foss and Volker Mahnke, eds., Competence, Governance, and Entrepreneurship: Advances in Economic Strategy Research (Oxford, 2000).
Nicolai J. Foss and Paul L. Robertson, eds., Resources, Technology, and Strategy: Explorations in the Resource-based Perspective (Routledge, 2000).


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