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The Atlantic: Why Amazon Pays Some of Its Workers to Quit

“… When I talked to Katherine Milkman, a professor at the Wharton School at the University of Pennsylvania, she brought up a similar idea, from the realm of social psychology. She talked about the mental pressure humans feel to resolve cognitive dissonance—if people have two conflicting beliefs, they’ll try to rationalize one to make it fit with the other. In this case, workers may dislike their jobs at Amazon, but if they turn down The Offer, it means they passed on a chance to quit. It’s likely that they’ll then try to convince themselves that they actually like working at Amazon, Milkman said. To pick a more extreme example of this phenomenon, when people join a cult that says the world is going to end on a certain date and then it doesn’t end, they tend to end up believing more strongly in the cult, because they can’t put up with the cognitive dissonance between what they believe and what actually happened.

Milkman also brought up ‘escalation of commitment,’ another concept studied by behavioral economists. The idea is that when people put a lot of money or effort into something and it appears to be going badly—perhaps they bought a stock and the share price is tanking—they often double down on their commitment. ‘They say, “I want to see this turn around—I don’t want it to turn out badly,”‘ Milkman said. When employees see that they’ve lost $5,000 by not taking The Offer, they might mentally recommit to the company, trying to do better at their jobs and enjoy them more.”

Read the rest of the article at The Atlantic.