Applying Rational Actor Model to I-deals-Team Effectiveness Relationship

Applying Rational Actor Model to I-deals-Team Effectiveness Relationship

• Associate Professor of Management Smriti Anand
• Assistant Professor of Economics Priyanka Sharma

Abstract:

We propose a theoretical model built on the foundations of rational actor model to examine idiosyncratic deals, informal contracts negotiated by employees to fulfill their unique needs and goals unmet by the organization’s formal policies and procedures. I-deals effectively create wage differentials between members of the same workgroup, and the resulting social comparison has implications for group harmony and performance. When one member has an i-deal and another doesn’t, it may evoke feelings of envy and disrupt group dynamics. On the other hand, if group members support each other, then they might benefit from one member’s deal (e.g., special training for one group member can benefit the entire group). We therefore draw on theories of economics to develop a mathematical model to explore when i-deals are most effective in group settings.

 

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