Conversely, those who lack feelings of power tend to prefer smaller immediate gains — those that benefit the present self — to potentially greater benefits in the future.
The data comes from “Power and Reduced Temporal Discounting,” a research paper written by Nathanael Fast, assistant professor of management and organization at USC Marshall, and Priyanka Joshi, a doctoral candidate in management and organization at USC Marshall. The paper appears in the current issue of Psychological Science.
A pervasive tendency among decision-makers to opt for immediate gratification — known as temporal discounting — has implications for everything from investing money and saving for retirement to developing a business strategy, Fast said. For more than a decade, researchers in numerous disciplines have sought ways to overcome temporal discounting because it is so widespread.
Fast and Joshi hypothesized that one of the ways to help people wait for larger future benefits in lieu of small immediate gains is to make them feel more powerful.
“Consistent with our predictions, we found that feeling powerful actually increased people’s willingness to wait for larger rewards,” Joshi said. “We also found that the experience of power in the workplace is positively correlated with one’s total accrued assets, even after controlling for more likely factors, such as annual income and age.”
In other words, power appears to foster saving behavior by putting people more in touch with their future selves.
“Power provides control over future outcomes so the future seems more certain when you feel powerful.” Fast said. “You’re therefore more likely to expand your sense of self to include your future self and, as a result, consider long-term consequences when making decisions.”
According to Joshi, decision-makers may better connect with their future selves by “power priming” or thinking of a time in their lives when they did have power over others.
“By revisiting experiences from the past, one typically experiences the same feelings they had during that time,” she said. “Of course, the best way for organizations to make their employees feel powerful is to actually give them more power.”
Fast added: “Our research doesn’t mean that power holders are always going to make the best decisions.
“Power also leads to greater risk-taking, illusory control and heightened reward sensitivity, all tendencies that can lead to disinhibition and poor decision-making,” he explained. “Yet power holders do often make good decisions, and they may be particularly good at considering future consequences.”