Abstract

In dynamic environments, when faced with a choice of which learning strategy to adopt, do people choose to mostly explore (maximizing their long term gains) or exploit (maximizing their short term gains)? More to the point, how does this choice of learning strategy influence one’s later ability to control the environment? In the present study, we explore whether people’s self-reported learning strategies and levels of arousal (i.e., surprise, stress) correspond to performance measures of controlling a Highly Uncertain or Moderately Uncertain dynamic environment. Generally, self-reports suggest a preference for exploring the environment to begin with. After which, those in the Highly Uncertain environment generally indicated they exploited more than those in the Moderately Uncertain environment; this difference did not impact on performance on later tests of people’s ability to control the dynamic environment. Levels of arousal were also differentially associated with the uncertainty of the environment. Going beyond behavioral data, our model of dynamic decision-making revealed that, in actual fact, there was no difference in exploitation levels between those in the highly uncertain or moderately uncertain environments, but there were differences based on sensitivity to negative reinforcement. We consider the implications of our findings with respect to learning and strategic approaches to controlling dynamic uncertainty.

Highlights

  • Consider the following issue: Every day, managers must decide what works and what does not work for organizational performance and effectiveness

  • The aim of this study is to explore an issue that has been of interest in the domain of decision-making, but for which there is virtually no empirical work looking at the relationship between affective experiences in varying levels of dynamic uncertainty of an environment people are attempting to control

  • The present study examines the extent to which this pattern generalizes to dynamic decision-making tasks, and examines the extent to which this learning behavior impacts on control performance at test

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Summary

Introduction

Consider the following issue: Every day, managers must decide what works and what does not work for organizational performance and effectiveness. Their current knowledge may not lead to superior outputs They need to explore by experimenting with novel approaches to learn about causal relationship between their new strategies and how this improves performance, but the value of exploration itself is unclear, when the broader environmental conditions (e.g., markets) are constantly changing. It may instead be more effective if the team manager renews efforts to exploit current policies and strategies rather than seek to change them

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