Perceived Legitimacy and Motivation Effects of Power

Abstract

Hierarchical structures are an important determinant of individual motivation in organizations, but the precise mechanisms through wich hierarchies affect motivation are still poorly understood. We use a laboratory experiment to study the impact of legitimacy of an organizational structure in this regard. In particular, our experimental design allows us to separate any effect of legitimacy perception from monetary incentive effects. We find that legitimacy perceptions are indeed a significant determinant of motivation. In our experimental principal-agent game, agent's who perceive the organizational structure as less legitimate provide less effort. Through exogenous manipulation of the legitimacy perception, we can establish that this relationship is causal.