How Might Centralization of Decision Making Adversely Affect Local Managers

question 51

Essay

How might centralization of decision making adversely affect local managers in an MNE?

Explain the concept of time preference and how it affects individual decisions related to consumption and saving.

Understand the factors leading to wage equality in a competitive economy.

Comprehend the reasons why wages differ across countries.

Recognize the impact of job characteristics on pay rates.

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Definitions:

Cognitive Dissonance

is a psychological phenomenon where an individual experiences discomfort due to conflicting beliefs, behaviors, or attitudes.

De-individuation

A psychological state of decreased self-evaluation and decreased evaluation apprehension causing antinormative and disinhibited behavior.

Stimulation and Crowding

The phenomenon where high levels of stimulation (from noise, people, etc.) can either energize individuals and improve performance or lead to discomfort and decreased performance, depending on context and individual differences.

Zimbardo

Philip Zimbardo, an American psychologist known for his research on social psychology, most notably the Stanford prison experiment.