Attribution theory

What is attribution theory? What is the fundamental attribution error (hint:self vs. other attributions)? Why is it important to distinguish between motivational and cognitive causes?

Attribution theory maintains that humans attribute causes to events into two distinctive types: the first is external attribution the assigns cause to outside phenomenon such as luck or the weather. The second is the reciprocal, internal attribution which places emphasis on the cause to personal traits. The fundamental attribution error is the assignment of events that are positive to internal attribution (“I did well on the test because I’m gifted”), and assigns negative events to external attribution (I did poorly on the test because the teacher was terrible”). The FAE is self-serving by design and for self-preservation. One must be able to differentiate between cognitive causes and motivational factors in order to better judge a situation, person or event based on the factors that truly affect the outcome.

Self-Fulfilling prophecy

Now is a great time to visit the concept of a self-fulfilling prophecy since so many are playing out in current events. I think many people have heard about this, but rarely have a understanding of the power that it holds over their actions. The classic run on the bank is a common example. It goes like this; the bank has enough reserves to conduct business as usual, but there is a false rumor going around that the bank may be on the verge of collapse and depositors should pull out their money to protect their interests. Next, on the advice of the false information the depositors in large numbers start to withdraw their money and in the process the bank is now in real trouble. Thus, what was originally not true has become true through the expectations that the bank would fail and the actions of the depositors which ultimately led the the bank collapse. There is a vast body of research on this subject in the workplace (an employee thinks they may get fired, and by changing their behavior because of this expectation, actually does get fired) and classroom (certain students are promoted as above-average, and this expectation leads teachers to expect and elicit better performance, thus getting above-average results because of the additional attention). Parents may do it to their own children even, based on generalizations of behavior (she's smart and and he's good at sports) which alters the outcomes for the child based on the same principal. Now it is happening in the market, stocks have a few bad weeks and more and more investors pull out their money which perpetuates further declines.

Recap from http://www.businessdictionary.com/definition/self-fulfilling-prophecy.html:

Positive or negative expectations about circumstances, events, or people that may affect a person's behavior toward them in a manner that he or she (unknowingly) creates situations in which those expectations are fulfilled. An employer
who, for example, expects the employees to be disloyal and shirkers, will likely treat them in a way that will elicit the very response he or she expects. Positive or negative expectations about circumstances, events, or people that may affect a person's behavior toward them in a manner that he or she (unknowingly) creates situations in which those expectations are fulfilled. An employer who, for example,
expects the employees to be disloyal and shirkers, will likely treat them in a way that will elicit the very response he or she expects.

Pay is NOT a motivator!

According to Herzberg's Two-Factor theory of job satisfaction there are hygiene factors and motivator factors. Hygiene factors are things an employee needs NOT to be dissatisfied with their job. These HF include pay and benefits, job security and status. The motivation factors are something different. They are growth, promotion, the job itself, recognition, and achievement. Don't confuse the two when you are trying to motivate your employees! Giving them a raise won't do it. Now, if the pay and benefits they currently receive are not meeting their basic needs then they will be dissatisfied and start looking for another job!