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Integrating Theories of Motivation

Author(s): Piers Steel and Cornelius J. Knig


Source: The Academy of Management Review, Vol. 31, No. 4 (Oct., 2006), pp. 889-913
Published by: Academy of Management
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? Academy o? Management Review
2006, Vol. 31, No. 4, 889-913.

INTEGRATING THEORIES OF MOTIVATION


PIERS STEEL
University of Calgary

CORNELIUS J. K?NIG
Universit?t Z?rich

Progress toward understanding human behavior has been hindered by discipline


bound theories, dividing our efforts. Fortunately, these separate endeavors are con
verging and can be effectively integrated. Focusing on the fundamental features of
picoeconomics, expectancy theory, cumulative prospect theory, and need theory, we
construct a temporal motivational theory (TMT). TMT appears consistent with the
major findings from many other investigations, including psychobiology and behav
iorism. The potential implications of TMT are numerous, affecting our understanding
on a wide range of topics, including group behavior, job design, stock market behav
ior, and goal setting.

The fields of economics, decision making, so sions within each discipline. Psychology, for
ciology, and psychology share a common desire example, has the traditions of self-regulation,
to understand our human nature?that is, our motivation, and personality, each with its own
essential character, disposition, or tempera nomenclature, structure, and etiology. These
ment. This extensive, multidisciplinar/y interest subdivisions necessarily divide our efforts, lim
in establishing who we are reflects the enor iting the extent to which insights can be shared.
mous ramifications of the endeavor. As Pinker This problem has recently been recognized and
(2002) catalogs, theories of human nature have lamented by many prominent researchers (e.g.,
been used to direct relationships, lifestyles, and Barrick & Mount, 1991; Elliot & Thrash, 2002;
governments?with disastrous effects when Judge & Hies, 2002), but it is by no means a new
based on faulty models. On a smaller applied issue. Consider the words of Irving Fisher, the
scale, treatments, training, compensation, and venerated economist, which are regrettably still
selection all depend on our theories of human far too relevant:
behavior. Even job design, which is an overtly The fact that there are still two schools, the pro
physical enterprise, requires positing human el ductivity school and the psychological school,
ements such as "growth need strength" (Hack constantly crossing swords on this subject [time
man & Oldham, 1976). To ensure the efficacy of preference/implicit interest rates] is a scandal in
our interventions, we need to determine what economic science and a reflection on the inade
describes, drives, or decides our actions. quate methods employed by these would-be de
stroyers of each other (1930: 312).
Ironically, our understanding of behavior has
been hindered by the very extent of our efforts. Fortunately, our theories also have several
There is a superabundance of motivational the strong commonalities, and their effective inte
ories. Not only does each field have its particu gration seems achievable (Klein, 1989; Larrick,
lar interpretation, but there are ample subdivi 1993; Mischel & Shoda, 1999). If it is possible to
do this?to effectively combine these different
We are thankful that the editor of our paper was Elizabeth
conceptions of human nature?we will have
Mannix, who gave us the opportunity to reply to the review substantially progressed toward a common the
ers' initially critical though insightful comments before ory of basic motivation. To use E. O. Wilson's
passing judgment. With her stewardship, the review process term, this convergence is an excellent example
produced a much better paper than what we first submitted. of consilience. Consilience is "a 'jumping to
Also, we greatly appreciate the combined contributions from
gether' of knowledge by the linking of facts and
a long chain of prior researchers, who provided the edifice
for this present publication. Despite regular academic dis fact-based theory across disciplines to create a
agreements, we all appear to be laboring toward a common common groundwork of explanation" (1998: 8). If
cause.
a theory can be shown to have consilience, its
889

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890 Academy of Management Review October

scientific validity is vastly improved, since it variance. We consider whether and when TMT
represents different avenues of inquiry coming may be too complex or too simple. Finally, we
to similar conclusions. We begin by further re note that in future research on TMT scholars
viewing the importance and advantages of such may choose to exploit two powerful but under
integration. used venues: a computerized personal system of
After this, we integrate four closely related instruction and computer simulations.
motivational theories, using the insights of each
to inform the others. We start with picoeconom
ics (Ainslie, 1992), which we then subsequently THE CASE FOR INTEGRATION
extend with expectancy theory (e.g., Vroom,
1964), cumulative prospect theory (Tversky & A common theme across the disparate disci
Kahneman, 1992), and need theory (e.g., Dollard plines of decision making and motivation is the
& Miller, 1950). It is important to note that none of desire for more comprehensive and integrated
these theories is definitive, each containing var theories (Cooksey, 2001; Eisenhardt & Zbaracki,
ious limitations. However, we are not attempt 1992; Langley, Mintzberg, Pitcher, Posada, &
ing a full integration of their every detail; in Saint-Macary, 1995; Leonard, Beauvais, & Scholl,
stead, we are focusing on linking together these 1999; Meilers, Schwartz, & Cooke, 1998). For ex
theories' most enduring and well-accepted ba ample, Locke and Latham, writing about the fu
sic features. One of the most important of these ture of motivational research, conclude that
features is time. "there is now an urgent need to tie these theo
Time is a critical component of choice or mo ries and processes together into an overall
tivated behavior. As Drucker notes, "The time model" (2004: 389). Also, Donovan recommends
dimension is inherent in management because in his review of motivation that "future work
management is concerned with decisions for ac should move towards the development and val
tion" (1954: 15). Similarly, Luce states that "quite idation of an integrated, goal-based model of
clearly any empirical realization of a decision self-regulation that incorporates the important
tree has a strong temporal aspect," and the fail components of various theories" (2001: 69; em
ure to include time "is a clear failing of the phases added). This desire reflects two funda
modeling" (1990: 228). Also, Kanfer (1990) and mental challenges in motivational research.
Donovan (2001) critique theories that are epi First, many traditional paradigms are inade
sodic and, thus, have difficulty accounting for quate for discussing or exploring many realistic
behavior over time and events. Fortunately, time and complex situations. Second, the very
or delay does feature in several motivational progress of our field is being hindered by seg
formulations, its application is consistent where regation.
included, and through integration it can be ex Because there has yet to be a broad, inte
tended to other theories where it was previously grated theory of motivation, any particular the
absent. Consequently, we label the outcome of ory necessarily deals with only a subset of mo
our integrative efforts temporal motivational tivational factors. Although a theory may deal
theory (TMT) because of its emphasis on time as with these factors very well, it potentially will
a motivational factor. have trouble in intricate, realistic situations.
After constructing TMT, we review its essen Owing to a situation's very complexity, a larger
tial elements and when it, rather than its source variety of forces may be operating. Conse
theories, should be applied. We also use pro quently, no single theory can adequately ex
crastination, a prototypical performance prob plain the observed phenomena. For example,
lem, to explicate the workings of TMT. As a expectancy theory, which represents rationality
general theory of human behavior, the applica in economics, is the simplest and consequently
tions of TMT are numerous. We identify four has been criticized for its limitations. Consider
diverse areas that might benefit by employing it able research has been summarized that indi
in specific ways. Also, we note that this model of cates we act less than logically (Lopes, 1994;
human behavior, like all models, must strike a Thaler, 1992). In fact, irrational behavior is so
balance between precision and parsimony. pervasive that Albanese concludes, "The eco
Some refinements may add undue complexity nomic assumption of rationality is violated in
while accounting for only minimal incremental the behavior of every person" (1987: 14).

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2006 Steel and K?nig 891

Rather than abandon expectancy theory, passed into adjacent fields and different solu
which has long been the dominant paradigm tions to be effectively harmonized.
and has proven value, we can make it much Consider economists and psychologists. As
more flexible by integrating it with other estab Lopes notes, they have been less than coll?gial
lished motivational principles. This approach in the past, tending to view each other with
has already been proposed by George Akerlof considerable "suspicion and distaste" (1994:
(1991), the Nobel Prize-winning economist. Aker 198). Similarly, W?rneryd (1988) quotes several
lof argues that his field should take salience eminent economists whose words on psychol
into account, salience referring to individuals' ogy border on the vitriolic. In fact, Loewenstein
undue sensitivity to the present and consequent (1992) observes that there has long been an ac
undervaluing of the future. He shows that the tive attempt to erase any psychological content
concept allows expectancy theory to more fully from economics. But, more recently, there has
grasp a broad range of areas, such as retirement been some integration, in the form of behavioral
savings, organizational failures, cults, crime, economics. Traditional economic theory, essen
and politics. Later in this paper, we also discuss tially expectancy theory, is being supplemented
several complex topics where a larger variety of with some of the very concepts that we later
motivational factors appear to be operating stress here (e.g., personality traits, temporal dis
than typically considered. An integrated per counting, loss aversion). As Camerer, Loewen
spective is invaluable in better understanding stein, and Rabin (2004) review, this is fundamen
them. tally reshaping the economic field and
In addition, scholars have observed as well as improving its explanatory power by basing it on
argued that continued segregation of our moti: more realistic psychological foundations.
vational theories is detrimental to scientific Consequently, fostering integration among
progress. The problem is serious. Steers, Mow different motivational disciplines is important
day, and Shapiro note that the theoretical devel and possible. First, it allows the development of
opment of work motivation has significantly a common language among social scientists
lagged behind other fields, that we still widely working in different fields. This should make
rely on obsolete and discredited theories, and communication and collaboration across disci
that intellectual interest in the topic has plines much easier. Second, it allows more ef
"seemed to decline precipitously" (2004: 383). As fective responses to complex motivational prob
Zeidner, Boekaerts, and Pintrich conclude, a ma lems, which can be multifaceted. As a later
jor reason for this decline is that "the fragmen example of procrastination confirms, self
tation and disparate, but overlapping, lines of regulatory failure can occur for many reasons,
research within the self-regulation domain have and effective treatment requires investigating
made any attempt at furthering our knowledge all these possibilities to find the most promising
an arduous task" (2000: 753). Similarly, Wilson and pliable junctures for intervention. Third, it
(1998), as well as Staats (1999), argues that the allows insights to be shared with fields overlap
progress for the social sciences is slow specifi ping in terms of features and complexity (i.e.,
cally because of the lack of consilience?the "cross-pollenization"). Psychological treatments
lack of integration. As Wilson writes: for addiction, for example, may inform the eco
nomic formulations of retirement saving pro
Social scientists by and large spurn the idea of grams (e.g., Akerlof, 1991; Loewenstein & Elster,
the hierarchical ordering of knowledge that 1992). As we show later, an integrative theory
unites and drives the natural science. Split into
facilitates the generation of new and plausible
independent cadres, they stress precision in their
words within their specialty but seldom speak hypotheses in a range of topics, from group be
the same technical language from one specialty havior to goal setting.
to the next (1998: 182).

DEVELOPING TMT
Wilson notes, however, that the medical sci
ences advance rapidly primarily because of To develop TMT, we consider four related un
consilience. Researchers can approach prob derstandings of human nature: picoeconomics,
lems at many different but mutually supporting expectancy theory, cumulative prospect theory
levels of complexity, allowing insights to be (CPT), and need theory. These four postulations

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892 Academy of Management Review October

are particularly well suited for consolidation, Summarizing the efforts from behaviorist and
since they reflect common sources in their de economic perspectives, Ainslie (1992) notes sev
velopment and, thus, share many terms. Conse eral attempts to provide an accurate equation.
quently, areas of overlap are quite definite. Fur Of these, the matching law is one of the first and
thermore, they can be expressed formulaically, simplest (Chung & Herrnstein, 1967).1 The match
allowing their integration with minimal transla ing law considers how frequency, magnitude,
tion and in a relatively straightforward manner. and delay of reinforcement affect choices, with
The terms in these formulations also provide a delay being the critical feature. It is the domi
ready summary of each theory's primary fea nant model describing choice among various
tures, which are also evident in a variety of concurrently administered, variable-interval
other formulations. To further underscore that schedules (Ainslie, 1992). In other words, when
we are integrating motivational fundamentals, we must choose among several courses of action
we begin each section by noting similarities that all result in a reward, albeit at different
with other prominent theories. We start with pi times, this model best predicts the aggregate
coeconomics since it, of all the theories consid behaviors of adults (see Myerson & Green, 1995).
ered, has time as its most central feature. Similarly, a related version of this law used in
the economic field also shows extremely strong
validity (see Loewenstein & Prelec, 1992).
Picoeconomics or Hyperbolic Discounting
The simplest version of the matching law con
Ainslie (1992), under the title of Picoeconomics, tains just four components:
and Ainslie and Haslam (1992), under the title of
Rate X Amount
Hyperbolic Discounting, discuss a theory that
helps to account for choice of behavior over time. Utilit? = Delay (1)
The theory already demonstrates considerable Utility indicates preference for a course of ac
consilience, with Ainslie drawing support from a tion. Naturally, the higher the utility, the greater
variety of research literature, including sociology, the preference. The next three variables reflect
social psychology, and psychodynamic psychol aspects of the reward or payout of the action.
ogy, as well as behaviorist psychology and eco Rate indicates the expectancy or frequency that
nomics in particular. For example, the personality the action will lead to the reward. It ranges from
traits of impulsiveness and future orientation all 0 percent to 100 percent, with 100 percent reflect
have strong commonalities to the concept of hy ing certainty. Amount indicates the amount of
perbolic discounting. In addition, recent work in reward that is received on payout. Essentially, it
psychobiology underscores the importance of hy indicates the magnitude of the incentive. Fi
perbolic discounting, with the journal of Psycho nally, delay indicates how long, on average, one
pharmacology recently dedicating an entire issue must wait to receive the payout. Since delay is
to the construct (e.g., Ho, Mobini, Chiang, Brad in the denominator of the equation, the longer
shaw, & Szabadi, 1999).
the delay, the less valuable the course of action
In its basic form, the theory is simple. We must is perceived.
choose from a variety of possible rewarding ac There also have been several modifications of
tivities. In choosing among them, we have an the basic matching law. Rate is often dropped,
innate tendency to inordinately undervalue fu since it can be partially expressed in terms of
ture events. We tend, then, to put off tasks lead
delay alone; over repeated trials, rewards deliv
ing to distant but valuable goals in favor of ones ered at lower rates necessarily create longer
with more immediate though lesser rewards. In average delays. Also, a new parameter is typi
evitably, however, time marches on, and as the cally included to capture individual differences
once-future events loom ever closer, we see their
regarding sensitivity to delay. The greater the
value more clearly. Eventually, we experience sensitivity, the larger the effect delays have on
regret if we have irrationally put off pursuing choice. Of all these modifications, Mazur's (1987)
this more valuable goal to the extent that it can
no longer be realistically achieved.
Going beyond this qualitative description, the 1 This matching law can be further decomposed into even
theory of picoeconomics tries to express the ef more basic behaviorist principles (Hernnstein, 1979)?
fects of temporal discounting mathematically. specifically, invariance and relativity.

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2006 Steel and K?nig 893

equation is likely the simplest and most wide FIGURE 1


spread: Preference Reversal Between Spending and
Amount Saving As a Function of Time Remaining to
Cash Bonus and Hyperbolic Discounting
Utility = z + T{T_t) (2)
High
Aside from dropping rate, there are three - Spending
changes from the original matching law. T ? t Saving
refers to the delay of the reward in terms of Preference reversal
"time reward" minus "time now." T refers to the Utility

subject's sensitivity to delay. The larger T is, the


greater the sensitivity. Finally, Z is a constant
derived from when rewards are immediate. It Low
Now Future
prevents the equation rocketing toward infinity t2
under periods of small delay and, thus, in Shiz Time
gal's (1999) terminology, can be considered the
determinant of instantaneous utility. In addition,
the reciprocal of this equation can be used to Expectancy Theory
predict preferences among punishers instead of
rewards (Mazur, 1998). Consequently, people Expectancy theory, or expectancy X value (E X
prefer distant punishers to more instant ones. V) theory, represents an extensive family of in
There have been several other attempts to fur dividual formulations. Vroom (1964) first intro
ther refine this equation, but without estab duced the notion to industrial-organizational
lished success. For example, explorations into psychology, but it has an earlier history in the
using other mathematical expressions (e.g., cognitive field (e.g., Rotter, 1954) that, in turn,
Logue, Rodriguez, Pe?a-Correal, & Maruo, 1984), can be predated by economic investigations un
particularly exponential functions,2 tend not to der the rubric of subjective expected utility (Ber
be as accurate (Green, Myerson, & McFadden, noulli, 1954). Its core elements appear in several
1997; Mazur, 2001), although they are still fa theories. To begin with, Bandura (1997) inte
vored in economic circles because of their close grates Ajzen's (1991) theory of planned behavior
resemblance to a purely rational discount into the traditional E X V framework. In turn,
model. In economics, this phenomenon is stud self-efficacy theory, which has been champi
ied under the designation of time preference or oned by Bandura, is closely related to expec
implicit interest rate (Antonides, 1991). tancy, if not identical in some respects (Bandura
Figure 1 outlines picoeconomics by display & Locke, 2003; Skinner, 1996; Vancouver, Thomp
ing the utility curves for two courses of action: son, & Williams, 2001). Also, Gollwitzer, when
saving or immediately spending an expected discussing his model of action phases, states,
financial bonus. From a distance, both options "Preferences are established by employing the
are effectively discounted, and the benefits of evaluative criteria of feasibility and desirabil
saving appear superior. However, when the bo ity" (1996: 289). Plainly, feasibility is related to
nus is received from the employer, at time tl, the expectancy, while desirability is a form of value.
spending benefits are immediate while the sav E X V theories suggest that a process akin to
ing benefits remain distant. Because of temporal rational gambling determines choices among
discounting, people likely find themselves courses of action. For each option, two consider
changing their original intentions, and this ations are made: (1) what is the probability that
crossing of utility lines reflects the well this outcome will be achieved, and (2) how much
established phenomenon of preference reversal is the expected outcome valued? Multiplying
(Ainslie, 1992; Loewenstein & Prelec, 1992; Steel, these components, expectancy and value (i.e.,
in press). What is planned today does not al E X V), the action that is then appraised as
ways turn into tomorrow's actions. largest is the one most likely to be pursued. A
major limitation to E X V models is that they are
episodic and, as mentioned, have difficulty ac
2 For example, Utility = e-r(T-i)Value (Frederick, Loewen counting for behavior over time (Kanfer, 1990).
stein, & O'Donoghue, 2002). This limitation may partially explain Van Eerde

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894 Academy of Management Review October

and Thierry's (1996) meta-analytic finding that CPT


E X V often predicts behavior over time rather
Tversky and Kahneman's (1992) CPT, an up
weakly and significantly less well than one's
date of Kahneman and Tversky's (1979) prospect
intention to perform. Fortunately, its incorpora
theory, is a descriptive model closely related to
tion into a hyperbolic discounting model largely
rectifies this weakness. traditional expectancy theory, particularly At
kinson's (1957) formulation. The major revision is
As mentioned, the numerator of the original
the introduction of an "approach/avoidance" di
matching law is composed of two terms: amount
chotomy, which is extremely well supported by
and rate. Respectively, these terms are equiva other research. Elliot and Thrash (2002), as well
lent to value and expectancy, reflecting a shift as Carver, Sutton, and Scheier (2000), review a
from a behavioral to a cognitive standpoint. The
confluence of findings from a variety of motiva
behavioral view expresses the equation's vari
tional formulations that supports its existence.
ables in terms of what should be objectively
Similarly, Ito and Cacioppo (1999), in their psy
observed. The cognitive view recognizes that the
chobiological investigation of motivation, pro
impact of all the variables is not uniform but
pose a "bivariate model of evaluative space,"
depends on interpretation differences among in
which they themselves note also provides con
dividuals, although the difficulty in determining
vergent validity to prospect theory.
these differences may be extreme. Conse
Often described as one of the leading theories
quently, amount is more accurately described in
of decision (e.g., Fennema & Wakker, 1997; Levy,
cognitive terms as the perceived attractiveness 1992), CPT seeks to describe choice under uncer
or aversiveness of the outcome. It reflects a sub
tainty by reconsidering how value is derived, as
jective evaluation, dependent on an individual's
well as how expectancy should be transformed.
perception. Similarly, rate refers to the fre Here, we review only the pertinent aspects of
quency that actions lead to rewards or, alterna
CPT: a full discussion of the original and cumu
tively, the probability of acquiring the expected
lative version of prospect theory requires more
outcome. By describing amount as value and attention than can be easily provided, although
returning rate to the equation in the form of it is available elsewhere (see Fennema & Wak
expectancy, picoeconomics begins to encapsu ker, 1997, and Tversky & Kahneman, 1992). Also,
late expectancy theory. The final equation for a relevant and recent psychological exam
should be as follows:
ple, see Hunton, Hall, and Price (1998), who ap
ply original prospect theory to the value of
Expectancy X Value "voice" in participative decision making.
utilit* = ?z + nr-o? (3) Focusing on its key theoretical elements, CPT
is very similar to the original prospect theory.
Of course, other modifications can be argued Acknowledging considerable variability across
from expectancy theory. For example, Vroom people, both theories codify regularities in how
(1964) breaks expectancy down into two compo we interpret values and expectancies. First, val
nents: expectancy and instrumentality. In this ues are based on outcomes that are defined as
case, expectancy refers to whether the intended losses and gains in reference to some status quo
course of action can be completed successfully. or baseline. These outcomes are transformed
Instrumentality refers to whether, having been following a function that is concave for gains,
successful, the expected rewards will be forth convex for losses, and steeper for losses than for
coming. Research indicates, however, that this gains. In other words, losses loom larger than
modification may be detrimental to predicting gains. Second, probability (i.e., expectancy) is
behavior, rather than helpful (Van Eerde & also transformed following a function that has
Thierry, 1996). Many other refinements have both convex and concave segments. Lower prob
been proposed, including terms that account abilities tend to be convex (i.e., overweighted),
for resource allocation (e.g., Kanfer & Acker whereas higher probabilities tend to be concave
man, 1996; Naylor, Pritchard, & Ilgen, 1980) and (i.e., underweighted). Similar to the determina
future orientation (e.g., Raynor & Entin, 1982). tion of values, the exact parameters for the
Regardless of the individual formulation, transformation of probability differ for losses
E X V is the core aspect. and gains. Consequently, the expected utility of

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2006 Steel and K?nig 895

any behavior is based on considering the com events. The notion of capacity, in Tversky and
bined utility of its possible gains and possible Kahneman's words, "can be interpreted as the
losses, with gains and losses each being esti marginal contribution of the respective event"
mated differently.3 (1992: 301). To combine all possibilities effec
By itself, CPT suffers the same limitation that tively, each outcome is evaluated incremental
Kanfer (1990) pointed out for expectancy theo ly?that is, relative to the value of other out
ry?that is, the failure to include time as a vari comes. For example, the expectancy weighting
able. Consequently, other researchers have al for any positive event is the weighted chance it
ready proposed various integrations of prospect or an even better outcome will occur, minus the
theory with some hyperbolic time-discounting weighted chance the next better outcome will
function (Loewenstein & Prelec, 1992; Rachlin, occur (e.g., similar to 40 percent - 30 percent =
2000; Schouwenburg & Groenewoud, 1997). 10 percent, except weighted). It is helpful to keep
Given this foundation and CPT's similarity to in mind the simple circumstance where only one
expectancy theory, only two terms are needed to positive outcome and/or one negative outcome
incorporate CPT into picoeconomics. is considered. In this case, the capacity of each
outcome is equal to ECPT, and the equation is
TTx-l-x _ V ^CPT X ^CPT V CPT X CPT more readily interpretable as no summation is
Utility - 2, z + r(r
i=l _ t) + Z z + r(r _ t)
i=k+l
necessary. Further discussion of capacity is
available in the articles of Fennema and Wak
(4) ker (1997) and, of course, Tversky and Kahneman
(1992).
For any decision, one considers n possible
outcomes. The first term, containing E?PT and
VqPT, reflects the transformed values for the ex Need Theory
pectancy associated with k gains and the per One of the earlier psychological theories was
ceived value of each of these gains. The second Murray's (1938) system of needs. As a whole, it is
term, containing E?PT and V?PT, reflects the somewhat dated, but key aspects endure in
transformed values for the expectancy associ modern personality theory (Tellegen, 1991), as
ated with n - k losses and the perceived value well as in the decision-making paradigm (Loe
of each of these losses. Given that losses carry wenstein, 1996). For example, personality traits
negative value, the second term will always di appear to be the behavioral expression of needs,
minish the first and, thus, the overall utility. The especially needs as measured by questionnaire
summation sign for each term reflects the pos (Winter, John, Stewart, Klohnen, & Duncan, 1998).
sibility of multiple outcomes given any act and, Consequently, we tend to be extroverted partly
thus, multiple possible gains or losses. It is this because of a need for affiliation and conscien
summation sign that makes CPT cumulative. tious partly because of a need for achievement.
Of note, although the ability to model deci We briefly review need theory's fundamental
sions with multiple possible outcomes is a sig components.
nificant improvement, it takes a moment to con To begin, needs represent an internal energy
sider how expectancy is interpreted under this force that directs behavior toward actions that
model. With CPT the decision weight or ECpt is permit the satisfaction and release of the need
not absolute expectancy but the capacity of itself (i.e., satiation). This face is what drives us
to do whatever we do. Needs can be primary or
viscerogenic, directly related to our biological
3 Mathematically, both the transformations for value and
nature (e.g., the need for food), or they can be
expectancy create curves reflecting logarithmic functions,
notably similar to Fechner's law (1966) describing just no secondary or psychogenic, related to our person
ticeable perceptual differences. Fechner's law states that, ality. Of these secondary needs, Murray initially
given x amount, you will notice a change of Ax that allows k guessed that around twenty might exist, al
to remain a constant, as in Ax/x = k. To be precise, however, though Winter (1996) suggests that only three
Tversky and Kahneman (1992) actually use a related but are fundamental: the need for achievement, the
exponential form of psychophysical scaling called "Steven's
law." Similarly, expectancy is also modeled using an expo need for affiliation, and the need for power. The
nential function. Informally, these functions may be de need for achievement is deriving pleasure from
scribed as the principle of diminishing returns. overcoming obstacles, the need for affiliation

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896 Academy of Management Review October

intimacy is deriving pleasure from socializing vides a classic formulation of expectancy the
and sharing with people, and the need for power ory, as well as Hull (1943), who provides some of
is deriving pleasure from gaining strength or the most influential formulations of behavior
prestige, particularly by affecting another's theory by far (Schwartz, 1989). Of note, behavior
well-being. These needs are not stable but tend ism is, as mentioned, the basis of the original
to fluctuate in intensity, ranging from a slum matching law of Chung and Herrnstein (1967).
bering satisfaction to an absolute craving. Core aspects of Atkinson's and Hull's theories
Our behaviors are ruled partly by need inten are virtually identical, both ultimately using ex
sity. At any time, the need that is the most in pectancy by value frameworks that differ funda
tense is the one we attempt to satisfy or to re mentally only in nomenclature. For example, in
duce through our thoughts and behavior. Thus, place of utility, Hull indicates excitatory poten
our actions represent our needs. Of most impor tial (sEr), while Atkinson uses tendency to
tance, need intensity can be influenced by ex achieve success (Ts). In place of expectancy,
ternal cues, described as press. Press occurs Hull refers to habit strength (sHr), while Atkin
when we encounter situations that we expect son uses probability of success (Ps).5 Finally, in
have a good chance of soon satisfying a need, place of value, Hull refers to a combination of
and, consequently, the salience and intensity of drive (D) and incentive (K), while Atkinson uses
that need become acute. Press has strong com motive strength (Ms) and incentive value (INs).
monalities with many modern and well-estab In McClelland's terms, Ms for success is equiv
lished psychological constructs. In a compre alent to need for achievement. In addition, At
hensive review, Tellegen (1991) connects press kinson proposes that the utility of any achieve
to several other theories (e.g., stimulus-re ment-oriented situation is determined by two
sponse) and theorists (e.g., Allport, 1961).4 individual-difference factors: the need for
These aspects of need theory share numerous achievement and the need to avoid failure. The
strong commonalities with our previous formu effect each need has on overall utility is calcu
lations. First, need intensity appears analogous lated separately, as with losses and gains in
to utility. In the same way we pursue actions CPT, with the resulting value indicating the ten
that most reduce our strongest need, we also dency to pursue achievement.
pursue actions that provide the most utility. Dollard and Miller (1950) provide even greater
Needs are related to value, helping to determine connection. They also attempt to describe some
the actual value that outcomes have. Although of the conflicts observed with psychodynamic
needs are often conceptualized at an average or drives or needs through behaviorism. Consis
a trait level, they do fluctuate because of satia tent with the concept of press, Dollard and Miller
tion. To predict aggregated behavior, the trait note that drive strength increases as we get
level will suffice (Epstein & O'Brien, 1985), but closer to the realization of our goals. This, they
for specific outcomes, we would prefer to know a explain, is due to the combined effect of two
need's specific strength. Finally, press is essen more basic principles of behaviorism: the gradi
tially a combination of expectancy and time de ents of reinforcement and of stimulus generali
lay. As we discuss later, others have reviewed zation. The gradient of reinforcement reflects the
these connections in great detail. temporal aspect?that is, the more immediately
To some extent, need theory can be further rewards and punishment are expected, the
integrated through the works of McClelland greater their effects. The gradient of stimulus
(1985) and Dollard and Miller (1950). McClelland generalization is akin to the element of expect
reviews the theories of Atkinson (1964), who pro ancy. Environmental cues best create approach
and avoidance behavior when they reliably pre
dict the occurrence of rewards and punishments.
4 There has been criticism that drive or need reduction is
a somewhat simplified view of reinforcement, and in a de
tailed review Savage (2000) concludes that this is true. How
ever, Savage also notes that, as a general concept, it has 5 Highlighting their similarity, Weiner, while reviewing
proven invaluable for organizing a wide range of motiva the history of motivational research, notes that "there was
tional states, which is consistent with its use here. Also, see some contentment merely in eliminating the term drive and
McSweeney and Swindell (1999), who recently revitalized the replacing the notion of habit with that of expectancy" (1990:
role that need theory may play in motivation. 619).

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2006 Steel and K?nig 897

So far, need theory appears to be largely de tion as an example of TMT?a phenomenon that
rived from the same fundamental features as is uniquely suitable for explanation.
picoeconomics, expectancy theory, and CPT. Be
havior is determined by need strength (utility), Fundamental Features
and long-term considerations (delayed) are only
relevant to the extent they affect its present in TMT has four core features: value, expectancy,
tensity. Need theory also provides two relatively time, and different functions for losses versus
unique contributions. The first has already been gains. The first of these, value, appears across
mentioned?that need theory explicates the in all four sources. Drawing on CPT and need the
dividual determinants of value (e.g., need for ory, value represents how much satisfaction or
achievement). The second regards the discount drive reduction an outcome is believed to real
ing constant, T, which is presently treated as ize. The attractiveness of an event depends on
identical for both losses and gains. However, both the situation and individual differences.
Dollard and Miller (1950) suggest that this in Outcomes can satisfy needs to different degrees.
crease in drive occurs at different rates for dif A full meal, for example, can assuage an appe
ferent needs. In their words, "The strength of tite better than a light snack. Furthermore, the
avoidance increases more rapidly with near relationship between outcome and value is cur
ness than does that of approach. In other words, vilinear and relative to a reference point, as per
the gradient of avoidance is steeper than that of Figure 2. Regarding individual differences, peo
approach" (1950: 352). More recent research, as ple differ in the degree they typically experience
reviewed by Trope and Liberman (2003), sug any need (e.g., need for power), and there can be
gests the opposite, however?that losses actu fluctuations around this baseline. Hungry peo
ally are discounted less steeply than gains. De ple are more motivated by food than those al
spite these differences, both these results ready sufficiently "suffonsified." To precisely
commonly indicate that T should not be kept at predict value for a specific person and option,
a constant but should differ for gains and losses. we must determine present need strength and
Consequently, our formula is revised in this how satisfying that option is perceived. If either
fashion: of these approach zero, then value itself will
also become negligible.
Expectancy occurs in each theory except pico
Utility = 2j 7 , r+,T _ A + economics. It represents the perceived probabil
z + r+(r -1) ^ z + r-(r -1)
i=l i=k+l
ity that an outcome will occur. Like value, this is
(5) influenced by both the situation and individual
differences. Plainly, different events have
With this final modification, we have con higher and lower likelihoods of occurring. How
structed TMT. It is an assimilation of the com ever, there are also stable trends regarding how
mon and unique fundamental features across
our four target theories. FIGURE 2
Weighted Valence (VCPT) As a Function of
Unweighted Valence {V). Per Tversky and
TMT Kahneman's (1992) CPT
TMT is derived from the core elements of the
above-described four well-established theories
of motivation: picoeconomics, expectancy the
= Va
ory, CPT, and need theory. TMT indicates that CPT
motivation can be understood by the effects of Unweighted
valence
expectancy and value, weakened by delay, with -10 10 *
differences for rewards and losses. The theory is
represented by Equation 5, and here we review -5
its fundamental features. We also consider how
the use of TMT can be harmonized with its four
source theories. Finally, we provide procrastina Weighted valence

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898 Academy of Management Review October

people ultimately perceive these likelihoods. chotomy indicates that, for each of
We tend to overestimate low-probability events ponents that are affected by
and underestimate high-probability events, as differences (value, expectancy, and
per Figure 3. Also, we have generalized expec further differences depending on
tancies that increase and decrease estimation outcome is perceived negatively o
(Carver & Scheier, 1989). A few specific person Figures 2 and 3, taken from prospe
ality traits that affect expectancies are attribu dicate how value and expectanc
tional style (Weiner, 1991), self-efficacy (Ban transformed. Differences between
dura, 1997), and optimism (Carver & Scheier, negative impulsiveness have not
2002). finitively established, although the
Temporal discounting appears in picoeco to differ. As Camerer et al. (2004) e
nomics and need theory (i.e., press). Being on the view, there are a variety of method
bottom of Equation 5, the closer temporally an founds that can affect discounting
event becomes, the greater its influence will be. cluding the presence of savoring
There are three components of TMT that capture wishing to delay and savor a rew
the effect of time. The first is T, which refers to same outcome can be perceived a
people's sensitivity to delay. In traditional trait gain, depending upon context. Sti
terminology, Monterosso and Ainslie (1999) ar that impulsiveness follows the sam
gue that T is largely equivalent to impulsive value, where losses loom larger. T
ness, and, indeed, several others have gathered consistent with recent psychobiolog
self-report data that empirically support their gations (Ito & Cacioppo, 1999), refle
affinity (Madden, Petry, Badger, & Bickel, 1997; for short-term events (e.g., deve
Ostaszewski, 1996, 1997; Petry, 2001; Richards, feet"), which should be evoluti
Zhang, Mitchell, & de Wit, 1999). Impulsiveness adaptive (Cosmides & Tooby, 2000
should never reach zero and is mostly stable, trend does not preclude atypical
although there may be environmental influenc who are more impulsive for gains.
er/s such as alcohol (i.e., alcohol myopia; Steele
& losephs, 1990) and drug use (Bretteville Hierarchical Nature of TMT
Jensen, 1999; Giordano et al., 2002). The second is
the delay itself?that is, (T - t). Simply, it repre The relationship between TMT a
sents the nearness or time required to realize an nomics, expectancy theory, CPT,
outcome. The third is Z. This is a constant that ory is largely that of simplicity. Th
prevents desire or utility from becoming infinite ries are simplifications of TMT,
when delay is effectively zero. fewer terms or eliminating idiog
Finally, losses and gains are separately cal tion. However, they also have som
culated in both CPT and need theory. This di tures and tend to explore particu
greater depth; for example, only
FIGURE 3 closely examines the role of satia
Weighted Expectancy (ECPT) As a Function of quently, their commonalities do no
Unweighted Expectancy (E), Per Tversky and redundant. As Locke and Latham al
Kahneman's (1992) CPT motivational theories "do not so mu
dict one another as focus on differe
1
the motivational process" (2004: 389
0.8 Er then, that these theories are not in
Et but, rather, should be viewed hiera
Weighted 0.6 CPT (Er+(l-Er)l/y
By "hierarchical," we mean that
expectancy
provides different benefits by focu
0.2 cific components and levels of an
arrangement is already implicit in
0 ?i-1-1-1? sciences, where "domains reach a
0.2 0.4 0.6 0.8
levels of complexity, from chemic
physical chemistry to molecular ge
Unweighted expectancy
ical ecology, and ecological genet

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2006 Steel and K?nig 899

the new specialties is considered more than a pectancy at all, and its treatment of value is less
focus of research" (Wilson, 1998: 11). For exam sophisticated. But it is extremely explicit regard
ple, a globe, a travel guide, and a housing blue ing temporal issues. When time is the critical
print are all maps, and although they focus on variable, picoeconomics is invaluable. Finally,
different features and levels of complexity, they need theory has elements similar to all those
each have their own purpose and do not make discussed, but they are not always well defined.
the others irrelevant. For example, the theory folds expectancy and
In determining which theory to use, we sup time into the single concept of press. The issue
port Albert Einstein's advice on this matter: this theory best represents is value and how
"Make everything as simple as possible, but not individual differences affect value. When we
simpler." Choose the theory that emphasizes the want to understand how a person's traits affect
features relevant to the issue at hand. The sim his or her behavior, need theory is the most
plest of these is expectancy theory, which comes useful. Of note, even when we recognize that
in two primary forms. Economists typically em individual differences are relevant, measure
ploy a version called "expected utility theory," ment limitations may still preclude their effec
which assumes no individual differences re tive employment.
garding the formulation of expectancies. Proba At the highest level of complexity is TMT, un
bilities reflect the situation entirely, which we der which all the previous theories are nested.
perceive without inflection or error. The theory is This theory is appropriate for explaining situa
normative, reflecting how people should be tions where expectancy, value, and time all af
have, if rational. fect decision making simultaneously and are all
The next level of complexity is subjective ex influenced by individual differences. Because it
pected utility theory, which introduces cognitive has the most number of terms, it is also the most
limitations and allows rationality to be bounded cumbersome to use. However, in the following
(Furnham & Lewis, 1986; Simon, 1955). That is, section we review a common example where all
trading accuracy for ease and speed, it can be these features are needed for explanation.
rational to make adequate although not optimal
decisions based on limited input and processing
(i.e., we satisfice rather than maximize). Subjec
An Example of TMT
tive expected utility theory is partially norma
tive, since the assumption is that we take a Procrastination, a prototypical motivational
rational approach when dealing with our cogni problem, is a phenomenon that occurs in at least
tive constraints. Consequently, expectancy the 95 percent of the population and chronically in
ory and subjective expected utility theory are approximately 15 to 20 percent of adults and in
most applicable to situations where people do 33 to 50 percent of students (Steel, in press). It
approximate rational decision making, such as also appears that oniy TMT can account for its
in aspects of stock market behavior (e.g., Plott, empirical findings. As meta-analytic review in
1986; Smith, 1991). dicates (Steel, in press), the strongest correlates
CPT, picoeconomics, and need theory can all with procrastination are task characteristics
be considered as operating at the next level of and individual-difference variables related to
complexity. Each is descriptive in that it is expectancy (e.g., self-efficacy, task difficulty),
based on empirical findings regarding how peo value (e.g., need for achievement, task aversive
ple actually behave, but each focuses on differ ness), and sensitivity to delay (e.g., impulsive
ent determinants of this behavior. Of these, CPT ness, temporal distance). A viable theory must
is most closely related to expectancy theory. Ex contain variables that address all three of these
pectancy theory is directly nested under CPT, elements at both an individual and situational
representing a special case where all the values level. Since TMT alone does this, no other theory
for the exponential functions are constrained to is feasible. Furthermore, a variety of other re
be to the power of 1 (i.e., exponential functions to sults support the TMT model. Procrastinators
the power of 1 straighten the lines in Figures 2 demonstrate preference reversal, for example,
and 3). CPT emphasizes how people reconcile consistent with hyperbolic discounting (see Fig
pluses and minuses when making decisions. Pi ure 1). That is, they plan to work but change their
coeconomics, however, does not consider ex minds and fail to act on their plans.

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900 Academy of Management Review October

Consequently, we can use a simplified sce FIGURE 4


nario based on procrastination to demonstrate Graph of Three Students' Utility Estimation for
how TMT relates to behavior. The archetypal Socializing Versus Writing an Essay over the
setting is the essay paper for the college stu Course of a Semester That Ends December 15
dent. Counter to the student's original inten 200
tions, he or she irrationally delays writing the - - Desire to socialize
paper and must then complete it close to the 150 ? Desire to study?Ann
? ? Desire to study?Betty
final deadline, often incurring great stress and 100 ? ? Desire to study?Colin
resulting in reduced performance. Although the
written assignment is given at the beginning of Utility 50
a semester, the student often ignores it until the November 29 -
0
last few weeks or even days. From a TMT per
spective, this is not surprising. -50
December 5
As TMT predicts, we pursue whatever course
-100
of action has the highest level of utility. Writing Oct. 31 Nov. 23 Dec. 16
Sept. 15 Oct. 8
an essay paper is often an intrinsically aversive
activity for many students; there is no delay Time
between engaging in it and experiencing a pun
ishment. The reward of achievement, however,
is relatively distant; it may not be felt until the semester, although socializing's positive compo
end of the semester, or perhaps even later, when nent is still temporally unchanged, its negative
grades are posted. To compound the matter, so component is more temporally proximate, di
cial activities and other temptations are readily minishing its utility. Similarly, the negative
available and intrinsically enjoyable; there is component for writing is still experienced imme
no delay in their pursuit or their rewards. Also, diately, but now its positive component is also
the aversive consequences of socializing are relatively imminent, thus increasing its utility.
distant. Although indulging in them creates an Writing activity eventually becomes increas
oppressive backlog of work, we can usually fore ingly likely as the deadline approaches, occur
stall confronting the consequence until much ring, in this example, on November 29 for Anne,
later. but six days later for Betty and Colin, on Decem
Consider three college students, Anne, Betty, ber 5. Note that Colin's impulsiveness makes
and Colin, who have been assigned an essay at him a mercurial individual, whose motivation
the start of a semester, on September 15. The during the final moments should overshadow
essay is due on December 15, at the end of the the others' best efforts.
course. All the students like to socialize but hate By changing any of the components of TMT,
to be overly stressed, and, conversely, they hate we could generate a multitude of other exam
to write but like to get good grades. There are ples. For instance, if any of the students liked
differences in other motivational elements, how socializing less, they would likely start writing
ever. Betty finds good grades somewhat less im earlier. Importantly, this highlights that self
portant than Anne and Colin (i.e., she has a regulatory failure occurs for a plethora of possi
smaller need for achievement), and she has a bilities. Differences in self-efficacy, task aver
lower sense of self-efficacy (i.e., expectancy). siveness, impulsiveness, and the proximity of
Colin, however, desires good grades even more temptations all can create similar observed be
than Anne but is the most impulsive. havior. Unless we can diagnose these root
Figure 4 maps the changes in utility for these causes instead of just the symptoms, the effec
three over the course of the semester regarding tiveness of any motivational intervention must
their choices between studying and socializing. typically be suboptimal.
In the early days of the semester, socializing's
negative component is temporally distant, while APPLICATIONS AND IMPLICATIONS OF TMT
its positive component is in the present. This
results in a high utility evaluation. These pa When we discussed the advantages of an in
rameters are exactly opposite for writing, giving tegrative approach, we highlighted three bene
it a low utility evaluation. By the end of the fits. First, an integrative theory should provide a

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2006 Steel and K?nig 901

common language among social scientists. Sec (see Figure 1) and how it is implicitly antici
ond, it should be applicable to complex and pated and counteracted in many political insti
realistic situations, improving description and tutions. He states:
prediction. Finally, it should facilitate the shar In the heat of passion or under the influence of
ing of insights among fields and, consequently, some immediate temptation, an individual can
the generation of novel and plausible hypothe deviate from prudent plans formed in advance or
ses. TMT shows these advantages. do things he will later regret. Groups of individ
Already, researchers are using the critical uals, such as voters or members of a political
assembly, are no less prone to such irrational
components of TMT to investigate topics from an behavior (1992: 39-40).
extremely wide variety of complex fields. For
example, prospect theory and temporal dis To deal with this inherent weakness, constitu
counting have been applied to addictive behav tions are often drawn that enact forms of pre
ior, attention deficit/hyperactivity disorder, con commitment. Part of this precommitment is lim
sumer behavior, health choices, job search, iting rules that we bind ourselves to so as to
military deterrence, soil conversation, strategic avoid later regrettable actions. Another precom
risk behavior, project management, and work mitment is creating a bicameral system, where
place violence (e.g., Barkley, Edwards, Laneri, decision making must pass through two cham
Fletcher, & Metevia, 2001; Baumeister, 2002; Be bers representing the electorate, such as a con
rejikian, 2002; Bleichrodt & Gafni, 1996; Das & gress and a senate (Joint Committee on the Or
Teng, 2001; DellaVigna & Paserman, 2005; Fred ganization of Congress, 1993). Retelling the
erick et al, 2002; Glasner, 2003; Glomb, Steel, & "saucer anecdote" of George Washington helps
Arvey, 2002; Hall & Fong, 2003; Krusell, Kuru??u, to illustrate the wisdom of this built-in delaying
& Smith, 2000; Petry, 2001; Rachlin, 2000; Thaler, mechanism. In a conversation between Thomas
1991; Yesuf, 2003). Also, here we ourselves used Jefferson and Washington, Jefferson asked why
TMT to account for all the observed findings a senate should be established. "Why," Wash
regarding procrastination. If the issue involves ington responded, "do you pour coffee into your
choice, TMT apparently can be applied. saucer?" "To cool it," Jefferson replied. "Even
To further demonstrate the advantages of an so," Washington said. "We pour legislation into
integrative approach, we consider four addi the Senatorial saucer to cool it" (Farrand, 1966:
tional areas. For each of these diverse topics, we 359). Other countries offer similar explanations.
review evidence that TMT describes fundamen In Canada, the Senate is often referred to as "the
tal effects and that there are new or rarely con house of sober second thought."
sidered implications. In increasing levels of Supplementing this political analysis is the
complexity, we first begin with group behavior, issue of the central bank. Central banks are
using it to emphasize both the importance of tempted at times to increase the money supply
temporal discounting and that TMT can be ap and, thus, cause inflation merely to immediately
plied to more than just individuals. Second, we reduce unemployment (for a review see White,
discuss job design, reviewing research indicat 1999). An unconstrained central bank may exces
ing that time and value are factors. Third, we sively exploit this option, to the detriment of the
consider stock market behavior, where both country's long-term economic health. To coun
prospect theory and temporal discounting ap teract this trend, Haubrich (2000) discusses the
pear to be in effect. Finally, we examine goal use of policy rules and removing the central
setting, which potentially exhibits all aspects of bank's discretion. The policy rules are inter
TMT. preted as a form of precommitment, similar to
"Ulysses lashing himself to the mast... as both
[government and central banks] face tempta
Group Behavior
tions to act at a given moment in ways that run
Many individual-level decision-making theo counter to their long-range goals" (Haubrich,
ries, heuristics, and biases are equally appro 2000: 1).
priate for describing group behavior (Pious, However, in the management arena, most
1993). This also appears to be true of TMT. In an team research has adopted a "punctuated equi
intriguing chapter, Elster (1992) examines pref librium" model, championed by Gersick (1991).
erence reversal created by temporal discounting This model suggests that team performance is

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902 Academy of Management Review October

not hyperbolic over time but demonstrates a satisfaction, causing con


sudden shift or discontinuity around the mid life when first implemented.
of a project. Although punctuated equilibrium is characterized as "a soulles
a useful evolutionary model and does appear to destroy the workingman's h
reflect some forms of organizational and strate his manhood" (Kanigel, 1
gic development (e.g., Romanelli & Tushman, that reached such an extent
1994), hyperbolic discounting appears to better House of Representatives
describe group performance. Specifically, committee to investigate
Waller, Zellmer-Bruhn, and Giambatista note systems of management. U
that several studies indicate a "curvilinear in fication was made palatab
crease in the rate of performance of task perfor ing wages, sometimes up
mance over allotted work time" (2002: 1047). first implemented (Taylor,
In addition, we reanalyzed the published data However, job simplificat
from Gersick's (1989) and Chang, Bordia, and Wages cannot always be
Duck's (2003) work on teams' time statements, with global competition),
which are an indication of work pace. As shown usually diminished by job
in Figure 5, the cumulative number of time state improving employees' sat
ments was significantly curvilinear (p < .0001) in goal in itself. Consequently
both cases, reflecting hyperbolic discounting improving motivation and
(i.e., work pace increases as the deadline ap veloped. Motivation-hygien
proaches). We expect that future research will 1966) and job characteristic
find that the average group levels of impulsive Oldman, 1976) are two e
ness will affect the degree of curvilinearity, sim Wall's (2001) review demo
ilar to the results already obtained for time ur several of these theories
gency (Waller, Conte, Gibson, & Carpenter, empirically confirmed, they
2001). developments, emphasizin
be better shaped to be rew
vidual differences will af
Job Design these tasks will be.
Job design is intrinsically related to selection. TMT indicates novel wa
Instead of selecting a person for the job, we this past work. As the lit
redesign the job for the person. Historically, ef here indicates, we are n
forts to redesign jobs have focused on simplifi come with definite tende
cation, as exemplified by Fredrick Taylor. Unfor then becomes how to desig
tunately, Taylorized jobs have a strong tendency commensurate with our m
to improve performance at the cost of employee Ideally, this would result
surable tasks?tasks we
even in the absence of fin
FIGURE 5 As a step toward this goal,
Graph Demonstrating That Work Pace/Time build settings that recog
Statements over the Course of a Group Project undervalue the future and
Are Not Linear But Curvilinear, Reflecting satisfy our basic needs. Th
Hyperbolic Discounting To begin with, hyperbo
cates we are likely to indu
enjoyable workplace activit
obtainable. Presently, howe
Cumulative time ies do not consider whethe
statements rior courses of actions are
For example, the internet
instantly accessible, and, c
surprising that they are al
Start ? Finish tors of work procrastinatio
Project time Skelly, & Chambliss, 2000; L

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2006 Steel and K?nig 903

Steel, in press), reducing productivity by billions in nature. Specifically, "investors seem to attach
of dollars (Mastrangelo, Everton, & Jolton, 2002). disproportionate importance to short-run eco
If access to these options could be delayed, even nomic developments" (Thaler, 1991: 259). Al
modestly, it would be easier for people to make though De Bondt and Thaler interpret this effect
rational use of them. primarily as an instance of Kahneman and Tver
Needs-based job design shows similar ne sky's (1979) representative heuristic, from a TMT
glect. We have an incomplete understanding re perspective it also appears to be an excellent
garding what tasks typically satisfy what de indication of temporal discounting.
sires. Essentially, we still must link what Consider the effect of bad news. Unlike antic
Dunnette calls "the two worlds of human behav ipated problems, sudden and surprising news of
ioral taxonomies" (1976: 477), a perpetual chal misfortune suggests an impending downturn in
lenge for our field. Schmitt and Robertson (1990) the stock price. The company value will dimin
reflect that this goal has been repeated in virtu ish and, consequently, so will the value of the
ally every selection review. Even Parker and stock. Some selling is, of course, then rational,
Wall note, in their more recent chapter on work and a dip in price is to be expected. However,
design, that "knowledge of individual differ stockholders with a high discount function will
ences as contingencies is scant" (2001: 96). overvalue this imminent loss and will oversell
As TMT indicates, performance is not only the to minimize it. The stock price will plunge past
result of having the appropriate motivational the optimal point, to where it actually becomes
drive; it must be stronger than other competing more rational to buy, given its expected long
drives. In any given job, its associated tasks term performance. This overreaction is formally
may strongly satisfy all the needs of an em exploited in the investment technique called
ployee or perhaps only a few. The remaining "Dogs of the Dow" (O'Higgins, 1991). Also, stock
needs must be met in other ways, perhaps by repurchasing programs seem to be an explicit
ineffective socializing, doodling, or daydream attempt to manage such shareholder short
ing. Consequently, when we design a job, deter sightedness (Sanders & Carpenter, 2003).
mining if strong needs are unlikely to be met
within the job's confines becomes very impor
Goal Setting
tant. Previous reviews by Schneider and Green
(1977) and Cantor and Blanton (1996) indicate One of the most widely used motivational the
that "rogue" needs can detrimentally affect per ories within an industrial/organizational con
formance. text is goal theory (Karoly, 1993), and for good
reason. Extensive study unambiguously indi
Stock Market Behavior cates that goal setting is an extremely powerful
technique (see Locke & Latham, 2002, for a recent
Stock market behavior is largely rational, but review). However, it has its limitations, lacking,
not entirely. Schiller (2000) touches on several for example, "the issue of time perspective"
instances of this, such as the British South Sea (Locke & Latham, 2004: 400). As we will show,
bubble of 1720 or the Japanese real estate bub TMT can account for goal setting's effects and
ble of the late 1980s. More recently, in 1996, the suggests new hypotheses regarding two of its
Dow Jones displayed what Federal Reserve moderators: goal difficulty and proximity. Im
Board Chairperson Alan Greenspan called "irra portantly, these novel predictions cannot be
tional exuberance." Economists have, for the made on the basis of previous attempts to ex
most part, concluded that investors do tend to be plain goal setting (e.g., Carver & Scheier, 1998;
risk averse, in accordance with prospect theory Fried & Slowik, 2004; Locke & Latham, 2002;
and, thus, TMT. However, it appears that the Raynor & Entin, 1982).
stock market is also vulnerable to temporal dis The effectiveness of goal setting can be
counting. largely explained by two aspects of TMT: the
In a series of papers, De Bondt and Thaler (see principle of diminishing returns (see Figure 2)
Thaler, 1991) reviewed research demonstrating and temporal discounting (see Figure 1). Any
that the stock market, as well as stock market division of a project into several smaller and
analysts, overreact to unexpected and dramatic more immediate subgoals appears to take ad
news events, both favorable and disagreeable vantage of these two elements. As mentioned,

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904 Academy of Management Review October

perceived value has a curvilinear relationship FIGURE 6


to a more objective assessment. Substantial di Graph Demonstrating the Superiority of Goal
visions of large goals may result in a series of Setting in Achieving Motivational Dominance
subgoals, each valued only slightly less than over Tempting Alternatives
that of the original whole. For example, al 90
though completion of an entire project may best 80 - - Background temptations Goal setting
satisfy one's need for achievement, each inter 70 ? ?; No goal setting
mediate step also temporarily satiates. Impor 60
tantly, these smaller subgoals can be completed 50
Utility
sequentially, allowing them to be realized more 40
quickly. 30
This state of affairs presents a potent motiva 20
tional opportunity. Research has shown that the 10
parsing of situations affects decision making. 0
15 30 45 60 75 90
For example, Rachlin (2000) discusses how gam Time
bling behavior is influenced by whether people
consider a period of betting as several individ
ual bets or as a single gambling session.6 By increase motivation. Although Latham and
subdividing a large project into smaller goals, Seijts argue that proximity affects performance
the sum of the parts can be greater than the by providing "additional specific information"
whole (to reverse a popular aphorism). Essen (1999: 422), TMT suggests a supporting explana
tially, goal setting increases the duration of mo tion: temporal discounting. Distal goals are sub
tivational dominance, when drive toward a stantially delayed, reducing the effectiveness of
course of action is likely to supercede competing expectancy and value.
options?an effect exemplified in Figure 6, There should be motivational tension be
where a person has ninety days to finish a tween goal difficulty and proximity. By dividing
project. Actions toward a goal occur only if its a large goal into variously spaced subgoals,
drive or utility exceeds that of other pursuits? each subgoal may be easier to achieve and,
that is, background temptations as represented thus, less satisfying. Consequently, there is
by the straight dashed line in Figure 6. Here, likely a breakpoint where the further subdivi
goal setting divides the project into three sub sion of a goal decreases its value more than can
goals, each valued at 80 percent of the original. be offset by the decrease in delay. Since TMT
With goal setting, a person would find that he or mathematically formalizes the relationship
she would be working toward the project for a among expectancy, value, and delay, it should
total of thirty days. Without goal setting, it indicate where this breakpoint should best oc
would be only fifteen. cur.
There are also several moderators that affect Specifically, impulsive individuals should be
the effectiveness of goal setting. TMT makes more motivated by proximity. It would be best
specific hypotheses regarding the interplay be for them to have more frequent but smalle
tween two of these: goal difficulty and goal goals. Conversely, those with a higher need for
proximity. As already understood, increasing achievement will more likely attend to goal dif
goal difficulty tends to increase motivation. In ficulty. Their motivation should be maximize
TMT terms, this effect is due to value. Increased by less frequent but harder goals. By attending
self-satisfaction arises from achieving the diffi to individual differences such as these, TMT
cult rather than the easy (Bandura, 1997). Also, should allow us to provide a goal-setting stra
the achievement of challenging goals may be egy tailored to a specific person, rather tha
come associated with rewarding outcomes, thus making us rely on general heuristics (e.g., goa
becoming a secondary reinforcer itself (Eisen difficulty, proximity). Importantly, this should
berger, 1992). The other moderator is proximity, lead to a dramatic improvement in goal-setting
since increasing the proximity of a goal tends to power, increasing the duration of any goal's mo
tivational dominance.
Of note, there are still other insights that TMT
6 See also Dawes' (1998) summary of sunk costs. can provide for goal setting, further demonstra

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2006 Steel and K?nig 905

ing that it can generate novel and plausible cation and hypothesis generation, it must be
hypotheses. Briefly, the presence of extremely generalizable, showing repeated merit in a va
attractive alternatives (e.g., raising temptation's riety of situations. Future research should focus
utility in Figure 6) can indicate when goal set on evaluating when and to what degree the in
ting will be less effective or ineffective. Also, if cremental variance that TMT provides is signif
there are separate motivational systems for icant. We discuss this further below.
losses and gains, then it may be preferable to Finally, there are a variety of methodologies
emphasize both the positive outcomes for suc with which this future research can be con
cessfully achieving a goal and the penalties for ducted. We suggest that two additional venues
failure. Assessing which system is dominant in should also be strongly considered: a computer
an individual indicates whether losses or gains ized personal system of instruction and com
should be stressed. puter simulations. Although rarely used, these
venues have the advantage of potentially being
FUTURE RESEARCH more realistic and allowing more complexity
while retaining research control of key vari
Aside from improving scientific communica ables. Their nature and advantages are also
tion and hypothesis generation, there are sev further reviewed below.
eral qualitative and quantitative criteria for
model evaluation (Myung, Pit, & Kim, 2004). A
Model Testing: Simplicity Versus Complexity
model should plausibly explain observed find
ings, it should be understandable (i.e., reflect The details of model testing are extensive and
established constructs), it should be falsifiable beyond the scope of any paper except a dedi
(i.e., may be validated), and its predictions cated review (e.g., Myung et al., 2004; Navarro &
should fit the observed data (i.e., "goodness of Myung, 2005). Briefly, it requires the accurate
fit"). TMT, by the very nature of its construction, measurement of the observed behavior, as well
fulfills these standards. as the constructs that are thought to give rise to
The strategy for integration was to focus on the behavior (i.e., specified by the model). To
the most important and heavily validated parts evaluate TMT, we would then need to measure
of the motivational field. Its expectancy and performance, along with both individual and ex
value components have already been well as perimental variables that reflect expectancy,
sessed by many researchers?more recently by value, and delay for both losses and gains. With
Tversky and Kahneman (1992). Its discounting this data, we could compare competing models
function is the culmination of extensive and var using a choice of indices, ones taking into ac
ied investigations, as summarized by Ainslie count both parsimony and completeness (e.g.,
(1992). Needs themselves have been studied for Akaike or Bayesian information criterion). If su
the better part of a century (e.g., Murray, 1938; perior results are again obtained in related data
Winter et al., 1998). Consequently, TMT has al sets (i.e., cross-validation), the model is general
ready been validated piecemeal. Also, adding izable.
extra adjustable parameters will invariably im We do not expect that the full TMT model will
prove fit to some degree (Forster, 2000). TMT consistently be necessary, as we indicated
should account for any observed data better when discussing its hierarchical nature. How
than any of its component theories. Still, there ever, it is difficult to argue why only a subset of
are two other standards to consider. the motivational fundamentals that compose
Part of model development is not only to have TMT ever apply. Such a position is radical and
goodness of fit but to do it parsimoniously. Con unsupported, requiring postulating a new scien
sequently, most model indices penalize for ev tific principle that prevents these fundamental
ery extra parameter (e.g., Akaike Information components from ever operating in concert. Con
Criterion; AIC). Undue complexity is not desir sequently, for complex situations where there is
able, and it remains to be formally shown that an assortment of options, considered by a di
the full TMT model accounts for significantly verse sampling of people, more of TMT's ele
more variance. Furthermore, it is not enough for ments should come into play. We already made
the full TMT model to be rarely useful. If it is to the case that the full TMT model is necessary to
have value beyond aiding scientific communi predict procrastination, as well as touched on a

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906 Academy of Management Review October

wide variety of topics where it should be appli variables and use them to compare competing
cable. The incremental variance potentially pro models. As the number of variables increases,
vided by TMT will depend on what topic is being there can be technical and administrative ob
investigated and what theory it is being com stacles in gathering the requisite data. In the
pared against. The more complex the topic (e.g., following section we consider two novel venues
consumer behavior) and the simpler the compet that can assist testing and applying complex
ing model (e.g., expected utility theory), the models.
greater TMT's value should be. Naturally, the
converse should also be true.
New Research Venues
It is possible, however, that TMT occasionally
is still not complex enough. One refinement that There are a variety of methodologies that can
future research may want to reconsider is the be used to further study TMT and its implica
approach and avoidance duality. A trichotomy tions. Traditional work on related concepts, es
may be the more appropriate representation. pecially temporal discounting, relied on com
Specifically, the avoidance or negative side of parative psychology (i.e., animal research) and
our nature appears to be less than unitary. For "casino" situations, where expectancy and
expectancy-related research, optimism appears value were expressed explicitly, typically in
to be better understood as three factors: opti terms of ratios, dollars, and deaths. Unfortu
mism, pessimism, and "fighting spirit" (Olason nately, although these situations give a great
& Roger, 2001). For impulsiveness, Cloninger deal of control, their limited realism and com
(1987) posits a tridimensional model, with sepa plexity makes their generalizability suspect (Ba
rate systems for gains (i.e., novelty seeking) and zerman, 2001). Consequently, we recommend
for losses (i.e., harm avoidance), and a third sys that two other venues also be considered: a com
tem he calls "persistence." This three-factor so puterized personal system of instruction and
lution has received recent support (Torrubia, computer simulations.
?vila, Molt?, & Caseras, 2001; Whiteside & Ly Since traditional methodologies have been
nam, 2001). Similarly, people's coping styles for criticized as potentially unrealistic, there has
uncertainty yield three comparable factors been a movement toward naturalistic decision
(Greco & Roger, 2001): emotional uncertainty making research (K?hberger, Schulte-Mecklen
(avoidance), desire for change (approach), and beck, & Perner, 2002). Ideally, we would like to
cognitive uncertainty (persistence). test further refinements to TMT on a wide range
From a broader perspective, Raghunathan of people who are striving at their own pace
and Pham (1999) note substantive differences toward an important goal in a standardized but
between the influences of sadness and anxiety realistic setting where we can precisely but eas
on decision making. Similarly, Krueger (1999), in ily measure their behavior. Although this is a
an examination of mental disorders, found that long list of specifications, there is at least one
a three-factor model explained comorbidity. venue that presently provides all these fea
Specifically, fear and anxiety-misery were best tures?a computerized personal system of in
understood as two subfactors of a high-order struction (C-PSI).
internalizing factor. Finally, recent neuropsy A personal system of instructions or pro
chological reviews do indicate the presence of grammed learning has been in use for decades,
other systems (Gray & McNaughton, 1996; Lang, but a computerized version has several desired
Bradley, & Cuthbert, 1997; Rothbart, Ahadi, & qualities. As used by Steel, Brothen, and Wam
Evans, 2000), such as fight-or-flight. Also, differ bach (2001), hundreds of students simulta
ent brain functions, which our motivational the neously work toward completing a university
ories ultimately model, tend to employ separate course at their own pace, allowing choice and,
as well as common components, making truly thus, motivated behavior. Furthermore, progress
orthogonal factors an inevitable fiction is assessed at an unparalleled number of points
(Damasio, 1994). as the course is broken down into numerous
Regardless of whether the goal is to deter assignments (e.g., seventy-eight), all computer
mine if TMT is too complex or too simple, it is an administered with completion precisely re
empirical matter and the same methodology ap corded. Similarly, a host of other observed and
plies. We must accurately measure the relevant self-report measures can be easily inserted into

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2006 Steel and K?nig 907

this framework. The only restriction is that stu idating commonalities. Our science would
dents must finish these assignments by the final progress more rapidly by sharing the findings
exam. Consequently, it is a good venue for de from different disciplines. For example, on the
termining if all aspects of TMT are necessary for one hand, the extremely well-supported time
prediction. Similarly, the efficacy of self discounting function evident in behaviorist and
regulatory interventions based on the TMT economic understanding of human nature is
model can be clearly evaluated in this setting. largely overlooked in other areas. In fact, most
We can not only see the outcome but can exam motivational reviews fail to refer to it (e.g., Fran
ine in detail people's progression toward their ken, 1994; Kanfer, 1990; Kleinbeck, Quast, Thi
goals. Future research should consider if other erry, & Hacker, 1990; Mitchell, 1997). On the other
existing realistic research settings could also be hand, economists have maintained, since at
adapted to provide similar benefits (e.g., the least Stigler and Becker (1977), that tastes or
Kanfer-Ackerman Air Traffic Controller Task; cf. preferences?that is, needs or traits?provide lit
Kanfer & Ackerman, 1989). tle or no prediction or explanation of human
Another novel venue for TMT research is the behavior. During the 1970s, this was a plausible
construction of computer simulations. Recent and popular position, even within psychology
advances in parallel computing are allowing us (e.g., Mischel, 1973). However, as Caplan (2003)
to effectively model extremely complex phenom outlines, our empirical findings over the last
ena, such as global weather patterns (Clauer et quarter century indicate that it is increasingly
al., 2000) and applied nuclear physics (Bigelow, outlandish to maintain such a belief.
Moloney, Philpott, & Rothberg, 1995). Conse TMT addresses such dysfunctional separation
quently, this technology is also being applied to by unifying insights from several different the
recondite areas of human decision making, such ories of motivation. Importantly, this is not a
as traffic (Pursula, 1999) and market behavior definitive model accounting for every aspect of
(Janssen & Jager, 2001), as well as several orga human behavior, but it does provide a common
nizational science topics (Hulin, Miner, & Seitz, framework of essential features. Using it, the
2002). Lauded as the "Third Scientific Discipline" extensive contributions from individual disci
(Ilgen & Hulin, 2000), with the first two being plines may be better shared by all, such as cog
experimental and correlational research, it has nitive psychology determining how expectan
the potential to open entirely new lines of study. cies change with experience or the findings
If consensus indicates that TMT does indeed from the self-regulatory disciplines indicating
provide a good approximation of decision mak how impulsiveness may be tempered. As Barrick
ing, TMT will provide the foundation for a new and Mount conclude, "In order for any field of
generation of simulators that can be used to science to advance, it is necessary to have an
initially test a wide variety of motivational in accepted classification scheme for accumulat
terventions, such as compensation systems or ing and categorizing empirical findings" (1991:
job design. Already, a rudimentary model incor 23). This model can provide common ground to
porating the notion of needs, satiation, and tem enable the necessary dialog.
poral discounting exists. It is the The Sims, the
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Piers Steel (Piers.Steel@Haskayne.Ucalgary.ca) is an assistant professor at the Uni


versity of Calgary's Haskayne School of Business. He received his Ph.D. from the
University of Minnesota's industrial/organizational psychology program. He continues
to research procrastination as well as synthetic validity, a half-century-old endeavor
to create a universal and automated selection system.

Cornelius J. K?nig (c.koenig@psychologie.unizh.ch) is a faculty member in the work


and organizational psychology group at Psychologisches Institut, Universit?t Z?rich,
Switzerland. He received his Ph.D. in psychology from Philipps-Universit?t Marburg,
Germany. His research interests include time management, multitasking, personnel
selection, and job insecurity.

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