On Iron Cages and Suboptimal Choices: An Experimental Test of the Micro-Foundations of Isomorphism in the Public Sector

Abstract

This study integrates experimental and qualitative data from a sample of public employees to investigate the micro-foundations of the isomorphic pressures that may lead to suboptimal decision making in the context of public administration. When asked to choose between two equally performing systems, subjects in our sample were inclined to favor the alternative that was encouraged by either a coercive, a mimetic, or a normative pressure. Participants tended to give in to isomorphic pressures, even when informed that the encouraged option was inferior. However, letting subjects autono- mously infer the inferiority of the encouraged option from numerical data—rather than through an explicit textual prompt—proved effective in neutralizing the risk of sub-opti- mal decisions under isomorphic pressures. A consequent qualitative inquiry revealed that trust in the recommending institution or group, speculation about alternative perform- ance dimensions, and compatibility with existing standards were the main drivers of sub- optimal decision making.