Suppose you recommend hiring a certain individual for a new job in your department,
and on the strength of your recommendation, she gets the job. As time goes on, the new
hire proves to be a poor employee. Some of your colleagues even recommend
dismissing her. However, because you were the person who recommended hiring her,
you stand by your recommendation and argue that she should be given more time to
prove herself on the job. Your behavior reflects the phenomenon of:
A) escalating commitment.
B) choosing an implicit favorite.
C) experiencing bounded rationality.
D) using a representativeness heuristic.
Equity theory suggests that managers should:
A) avoid transparency in pay practices.
B) strive to pay all employees equitably.
C) use pay scales as a bludgeon to keep employees in line.
D) use overpayment to increase long-run performance.