Friday, October 20, 2017

The Dark Triad

While the therapy world gnashes its teeth over who is feeling whose feelings, social psychologists are hard at work identifying what it takes to succeed in the real world.

Sometimes they sound like moral philosophers. At other times, they seem to be culture warriors. If you think that capitalists are evil and venal you will accept the theory that people who succeed in business are evil and venal. To put a finer point on it, the social psychologists have previously declared that success in the business world would befall those who possessed the “dark triad,” who were Machiavellian narcissistic psychopaths.

For my part, I find the term “dark triad” to be inspired. It could easily be the title of a horror movie. We should be happy to recognize creativity, regardless of where it comes from.

Anyway, those who think that capitalists are fundamentally bad people, or that you cannot succeed in the dog-eat-dog world of business without being a dog yourself were happy to embrace the dark triad. Some people found it reassuring that their own obnoxious and repellent personality traits had destined them for success. I trust that the same people also love horoscopes.

Now… fanfare, please… researchers have discovered that people who possess the dark triad are less capable and weaker performers. When it comes to running hedge funds, being a narcissist or a psychopath or even manipulative will, in the long run work against you.

The Daily Mail reports the story:

From The Wolf of Wall Street to The Big Short, many films about the financial sector feature people with the 'dark triad' of personality traits - psychopathy, narcissism and Machiavellianism.

But a new study suggests that people with these traits may not necessarily make the best investment decisions compared with 'nice guys'.

This is because they are often overconfident and reckless - causing them to stick with bad investment decisions longer than they should.  

The findings add to a growing body of evidence suggesting that Dark Triad personality traits are not desirable in leaders.

This suggests another slogan: Nice guys finish first. It may not be intuitively obvious, and the research primarily involves investment decisions, but it is good news for those who are working to develop their good character. Who knew that getting along with other people, showing respect and courtesy would make you more successful than seducing and manipulating people in order to pursue a goal more ruthlessly.

The Daily Mail explains the results of the most recent study:

Previous studies have suggested that people with the 'dark triad' of personality traits  make the best managers.

But in a new study, researchers from the University of Denver suggest that this isn't the case.

Dr Leanne ten Brinke, lead author of the study, said: 'We should re-think our assumptions that might favour ruthlessness or callousness in an investment manager.

'Not only do these personality traits not improve performance, our data suggest that they many hinder it.'

One suspects, in passing, that what counts as callous indifference was in many cases a sign of competitive focus, and therefore an absence of empathy for one’s opponents. Such an attitude does not bespeak a personality defect. It is a sign of a competitive personality. It does not matter when you feel empathy for your opponent. What matters is that you display sportsmanship. This coincides with a more cooperative attitude—you cannot compete effectively if you are not a trustworthy teammate.

I am sure you want to know what counts as psychopathy. The newspaper explains:

Psychopaths display different traits depending on their disorder.

Common signs include superficial charm, a grandiose notion of self-worth, the need for stimulation and impulsiveness, pathological lying, the ability to manipulate others and a lack of remorse and empathy.

Of course, getting other people to do what needs to be done because they want to do it, as Eisenhower suggested, is not necessarily manipulative. When you seduce people into doing  your bidding because you want it done you are being manipulative. When you are getting them to do what needs to be done you are leading them. Is it about the leader's personality or the good of the company... the distinction is worth underscoring.

Bloomberg News reports on the same research. It emphasizes the fact that a good investor does not go it alone. He works with other people, shares ideas and respects differences of opinion. He does not try to impose himself on the world:

However, some psychologists have shown that the quality of work exhibited by people with such tendencies [the dark triad] can fall short. “More psychopathic individuals tend to be able to talk the talk, but not walk the walk,” ten Brinke said. Over time—and measured by an objective standard such as investment returns—their shortcomings can become glaringly obvious.

Psychopaths are also very difficult to work with, as one could probably surmise. Investing, like other fields, can require collaboration, listening to the ideas of colleagues, and hiring specialists to execute your strategies.

It concludes with a cautionary note:

“There’s good research to suggest psychopaths are poor leaders,” ten Brinke said. “If you put someone with psychopathic traits [in charge] of a group, they’re more likely to divide the group.”


Ares Olympus said...

I don't know about what makes a best investor, but it does seem like people high in the Dark Triad would thrive relatively well in high conflict situations, and their lack of conscience could help them be effective leaders in the sense of confidently scapegoating outsiders and as leaders could encourage ruthlessness, and ideologies like "final solutions" that see coexistence as impossible. And as long as they can properly keep all aggression directed outwards, they can maintain a high aggression stance without risking the violence being directed back towards the leadership. But their power may wane if they run out of credible enemies to fear-monger against, and then the aggression risks turning inward and upwards, and then its time to leave with a suitcase of cash and diamonds, at least for smart psychopaths. Maybe that works in finance too? At least a few escaped Enron with millions, right?

I see Wikipedia also has a significant article on the subject and mentions 3 personality traits that correlate. Perhaps I'd better start working on improving my agreeableness on this blog, although at least I aspire to no leadership, and unlikely to attract a following, so the harm I may cause should be relatively small.
A factor analysis found that among the big five personality traits, low agreeableness is the strongest correlate of the dark triad, while neuroticism and a lack of conscientiousness were associated with some of the dark triad members.

David Foster said...

"their lack of conscience could help them be effective leaders in the sense of confidently scapegoating outsiders"

Focusing on leadership for the moment: Scapegoating external competitors is kind of meaningless, since one expects competitors to be on the other side. Scapegoating one's own employees isn't going to do you much good: after all, you hired (or at least retained) these employees, and your boss will be well-aware of that fact.

How about scapegoating other organizations? ('The reason we can't get product out on time is that those idiots in marketing keep changing the requirements', or 'The reason we missed our sales quote again is because the product was late.') This is more problematic; after all, there are cases whether organizational interdependencies are such that a different team *really was* at fault. But still, the scapegoater and the scapegoatee report to the same person at some level, and zero-sum games among that person's subordinate organizations don't do *him* any good.

There have been cases where I've had to get rid of an otherwise-talented manager because he wouldn't stop conducting political warfare against another one of my subordinate managers. My point that his attacks on the other guy weren't doing *me* any good did not seem to register.

trigger warning said...

The Jakobwitz-Egan factor analysis study mentioned above actually found that (dis)Agreeableness explained an eye-popping 18% (wowzers, dude!!!) of the variance on the "Dark Triad" (aka the Axis of A**holery), and Agreeableness had the strongest loading of any factor investigated.

Excuse me while I laugh. Oh wait! It's science, dude!

In any hard science, a correlation that weak would be buried in the backyard in the dead of night.

Wikipedia science articles can be a dangerous place without a STEM background.

sestamibi said...

I question the quals of the lead researcher. Do they include a commitment to radical feminism?

trigger warning said...

PhD in "mental health sciences", whatever that is.

"My research is focused on improving access to mental healthcare for marginalised populations..."
--- Sharon Jakobowitz

She also has iPhone-grade statsware.


Ares Olympus said...

David Foster said... Focusing on leadership for the moment: Scapegoating external competitors is kind of meaningless, since one expects competitors to be on the other side.

Agreed, effective scapegoating is a little tricky when you can't kill or maim your rivals, but it does help with immoral activity, like Lance Armstrong's doping rationalizations, saying everyone else is doing it.