GOOD MORNING

BUS 314
DO YOU THINK THAT
BEING EMOTIONAL
DURING DECISION-
MAKING IS “BAD”?
 CONTENTS
1) The delivery of ideas from the research paper
Literature review and Hypothesis
Methods & Data collection
Results and Discussion
2) How the research paper related to OB study?
Introduction● Link affective experience and
decision-making performance
● 3 ways to extend the search
- Provides direct empirical
evidence
- Examines contrasting
perspectives
- Demonstrates the degree
→ affective feelings are
functional or disfunctional in
decision making.
1)The delivery of ideas from the
research paper
 ● Feeling as bias inducer

- Skew decisions in certain ways

→ harmful to decision making

performance
Literature Review ● Feeling as decision facilitator

- Facilitate affective feeling

→ improve decision making

performance
 ● Affective Influence Regulation: the
degree to which people regulate
the bias generating influence of
their current feelings.

Test Hypothesize ● Affective Reactivity: the degree to

which individuals experience
intense feelings during decision
making.

● Emotion Differentiation
Affective Influence Regulation ● Individual “high” affective
and Decision-Making Performance influence regulation

Hypothesis 1 → less influenced by affective feelings

● Individual “lower” affective

Individual higher, rather
influence regulation
than lower, in effective influence
regulation achieve higher → perform worse
decision making performance.
 Affective Reactivity & Decision-
Making Performance
Hypothesis 2
Individuals higher, rather
than lower, in affective
reactivity during decision-
making achieve higher
decision making performance.
● Affective reactivity dimensions:
- affect intensity
- emotional intensity
● Individuals “higher” affective
reactivity
- experience more intense feelings
during decision making.
Interaction between Affective
Influence Regulation and Affective
Reactivity

Hypothesis 3
● Affective intensity “systematically
The relationship between associated” decision making biases.
affective reactivity and decision
● Affective reactivity “influences”
making performance is stronger decision making performance.
for those individuals who are
higher, rather than lower in
affective influence regulation.
Emotion Differentiation and
Affective Influence Regulation ● High emotion differentiation

→ an advantage in regulating their

Hypothesis 4 affective experience.

● More emotion differentiation

Affective influence → Achieve higher decision making
regulation mediates the performance.
relationship between emotion
differentiation and decision-
making performance.
Metho
d
 118 participants

+ Age: 18-74
+ 86% are male
+ Average of experienced in
Participants investment: 4,3 years
- 0-1 year: 16%
- 2-3 years: 20%
- 4-5 years: 15%
- 5-10 years: 16%
- More than 10 years: 7%
 Affective reactivity
22 affect-related adjectives that represented the circumplex structure of core
affect:
- 2 - pleasant (happy, satisfied)
- 5- pleasant (excited, joyful,
enthusiastic, proud, interested)
- 2 indicated activated feelings
(“aroused” and “surprised”)
- 5 Indicated unpleasant
(irritated, afraid, angry,
nervous, frustrated)
- 2 indicated unpleasant (sad,
disappointed)
- 2 indicated unpleasant
(depressed and tired)
- 2 deactivated feelings (quite
and still)
- 2 indicated pleasant (calm and
relaxed)
Derived an affective reactivity in-
dex each day for each participant

1072 cases (57%) pleasant feelings were

dominant affect state for a given day
1868
cases

796 cases (43%) unpleasant feeling

were predominant
Affective influence regulation.
Computed an index of affective influence regulation for each participant

- 1st: computed the degree of pleasantness

- 2nd: from each participant’s daily stock investment portfolio, we
computed three parameters that indicated the degree of risk chosen by
the participant in making his or her stock investment decision on a given
day.
- 3rd: risk indicator was the average one-year return of a stock portfolio.

=> the higher index, the more risky the investors would take
 - Computed two emotion
differentiation indexes, one for
pleasant feelings and the other for
Emotion unpleasant feelings.
+ First, individuals often experience
differentiation. more pressure to understand and
actively regulate their emotions
when they experience negative
rather than positive emotions

=> As a result, individuals often

better differentiate among negative
feelings than positive feelings
Decision
performance
- Decision performance
was measured as the
average daily stock
investment return
generated by each
participant
Control
variables.
Age is an important factor
influencing affective
experience and its
influence on cognitive
processes
 The participants had to
follow the instructions from
the searchers step by step
Procedures including the producers of
investment, the time to
research the stock market,
history of investment
 108/118 participants were collected
because they follow successfully the
introduction from the researchers.

Other methods: Using SEM. Following

Hatcher (1998), they used several
Data Analysis indexes of model fit, including (1) the
chi-square goodness-of-fit statistic, (2)
the root-mean-square error of
approximation (RMSEA), (3) the
goodness-of-fit index (GFI), (4) the
adjusted goodness-of-fit index (AGFI),
(5)the normed fit index (NFI), and (6) the
comparative fit index (CFI).
 The model was used to test 2
main effect hypotheses
(hypothesis 1 and 2)

and also used as a bias for

Results further testing the Interaction
hypothesis (hypothesis 3)

and the Mediation (hypothesis

4)
 a. Hypothesis 1

According to SEM results, the

data fitted the data well and
the coefficient (path a) was
1.Basic Hypothesis positive and significant.

Model ➔ Supported Hypothesis 1.

➔ It means that participants
who were less influenced by
their current feeling achieved
higher daily investment
return.
 b. Hypothesis 2

According to SEM results, the

data fitted the data well and
the coefficient (path b) was
1.Basic Hypothesis positive and significant.

Model ➔ Supported Hypothesis 2.

➔ It means that participants
who experienced affective
feelings with greater intensity
during investment achieved
higher investment return.
 According to SEM results, the
moderation model fitted well with
the data, however, the path
coefficient of interaction term was
not significant and near zero.
2.Moderation ➔ Hypothesis 3 was not

Model supported.
➔ It means that both Affective
(testing hypothesis 3) Influence Regulation and
Affective Reactivity
contributed to decision
performance additively, not
interactively.
 According to SEM results, the path
coefficient from positive emotion
differentiation to Affective Influence
Regulation (path c) is positive, but it’s
not significant. In contrast, the path
coefficient from negative emotion
3.Mediation differentiation (path d) is both positive
and significant.

Model ➔ Partially supported.

➔ It means that participants who
(testing hypothesis 4) reported their negative affective
feelings were less influenced by
their affective feelings in the
degree of risk in their daily stock
portfolio.
 Some popular belief

● “Cooler head prevails”

● “Don’t let your emotions run
your life”
● “Ignore your emotions”

Discussion
➔ This study shows that feelings
and emotions experienced
during decision making can
have positive effect on
decision making
performance.
 There are two implications from
the study
Discussion 1. Theoretical Implications
2. Managerial Implications
 1. This study focused on their bias
inducing role (generally ignored the
role of affective feeling).
2. This study provided evidence that
both functional and dysfunctional
effects of affective feeling on
Theoretical decision making simultaneously with
individuals.

Implications 3. This study also contributed to the EI

(emotional intelligence).
4. The study also showed that people
would achieve the benefits of
successful Affective Influence
Regulation from understanding and
differentiating among their current
negative feelings.
 1. The study showed that better
performers could better distinguish
among their negative feeling states.

Managerial 2. The study also showed that affective

experiences have the potential to
Implications both facilitate and hinder decision
making within individuals and to do
so simultaneously.
 ➔ The study suggested ways in which
managers and employees can reduce

Managerial the possibly bias-generating effects

of their current affective states and
thus increase decision making
Implications performance.
● Increasing the degree that they
attend to and clearly distinguish
among their current affective
feelings during decision making.
● Increasing their general levels of
emotional self-awareness.
 Limitation 1: the study was based on

Limitations and a correlational research design.

➔ Future research directions:

Future Research studies in which affective feelings
are experimentally induced in
Directions participants.
 Limitation 2: the study was too
domain-specific to effectively capture

Limitations and participants’ general affective

characteristics and the calculation

Future Research were based on certain untested

assumption.

Directions ➔ Future research directions: using

emotional clarity scale.
 Limitation 3: the relationship
between affective intensity and
Limitations and decision making performance may be
nonlinear.
Future Research ➔ Future research directions:

Directions determine the precise

relationship.
 Limitation 4: affective processes
include both conscious and
subconscious processes and the latter
may have suppressed or amplified the
Limitations and study results.

Future Research ➔ Future research directions:

exploring both the conscious and

Directions subconscious processes of

affective information processing
and its effects on decision
making performance.
 Limitation 5: cash reward could have
influenced some of the results
Limitations and ➔ Future research directions: using

Future Research different remuneration structure

to balance between possible

Directions gains and losses are needed to

confirm key finding.
Limitations and Limitation 6: more research is
needed to explore and examine

Future Research individual-level characteristics that

might have further influenced the
results of this study.
Directions
2) How the research paper related to
OB study?
 1. Intuitive decision making
OB Applications 2. Emotional Intelligence
3. Job Attitudes
 THE END!
Thank you for your listening :D
 Reference
Seo, M. G. & Barrett, L. F. (2007). Being emotional during
decision making - good or bad? An empirical investigation.
Academy of Management Journal, 50(4), 923-940.