How the Basis for Status Perceptions Varies with Perceiver Status

Abstract

We posit a novel mechanism—socially endogenous calibration—whereby the tendency to align with others’ perceptions of organizational status varies systematically with the status of a perceiver’s own organization. We specifically theorize that members of higher-status organizations perceive larger and more correlated status differences among other organizations than members of lower-status organizations do. Using a simulation, we demonstrate how socially endogenous calibration yields these predictions even when quality is uniform across organizations. We further present empirical support for our arguments by analyzing data on individual-level prestige ratings of U.S. law firms. Integrating socially endogenous calibration with prevailing status perspectives based on quality uncertainty, we conclude by elaborating a novel research agenda on stability and instability in organizational status hierarchies.