A Name Too Big: Status-quality Discrepancy and Conformity

The role of status as a quality signal depends on a positive but loose coupling between status and quality. While prior studies have made efforts to control for quality in order to establish the effect of status, very limited attention has been paid to the implications of their loose coupling per se. We emphasize that the nature of loose coupling induces discrepancy between actors’ status and quality, such that some actors’ status positions are over-ranked relative to their underlying quality while others are under-ranked. We underscore this discrepancy because it may place important constraints on actors’ behavior. Focusing specifically on actors’ behavioral conformity, we argue that actors with a larger status-quality discrepancy may perceive a greater sense of threat about their status positions, so that they are more likely to conform to conventional practices. Analyzing recommendations and forecasts by investment analysts, we find support for our hypotheses. Our emphasis on the status-quality discrepancy makes broad contributions to the status literature. 

Zoom: https://eur-nl.zoom.us/j/97035117750?pwd=Rmp3NG9Pci9jWm1NWEc1TWVGV2dodz09