Do personality traits affect decision-making ability: can MBTI type predict biases?

Abstract

From decades of psychological research, the observation that people’s decisions are often biased by particular decision-making flaws has led to discussions of what can be done to de-bias decisions. A key area of research is the study of individual differences in decision-making ability— that is, whether certain people are less susceptible to particular biases. Much of this research, however, has focused on the impact of intelligence on decision-making ability. This, however, is of limited use in industries such as oil and gas where, due to hiring criteria that commonly include at least a bachelor’s degree, a restricted range of intelligence is observed. Given this, it may be more fruitful to consider other sources of potential differences in decision-making ability such as personality traits. The Myers-Briggs Type Indicator (MBTI) (Myers et al, 1998) is a personality test based on Jung’s 1921 theory of psychological types (see, e.g., Jung, 1971). People are sorted into one of 16 categories based on their responses to the personality test. Although the test is widely used to identify leadership styles and preferences and therefore influence recruitment decisions (including within the petroleum industry), the impact of Myers-Briggs personality type on decision making itself and, in particular, on decisionmaking biases, has not been thoroughly investigated. A large number of specific, cognitive biases have been identified by psychologists and in this study we have chosen to investigate two of particular interest in the oil and gas industry: overconfidence and risk attitude/framing. It has been shown (Welsh and Begg, 2008; Welsh et al, 2007) that these biases can have disastrous consequences on the value of projects in the petroleum industry. If it is possible, therefore, to use an easily administered and well-known test (MBTI) to quantify and predict an individual’s susceptibility to bias, we can improve decisions in the industry by ensuring that the right people are employed to make decisions where bias may prove to be a problem. To test this, we distributed a survey—which included the complete Myers-Briggs test and questions to identify biases in the respondent’s responses—to engineering students at the University of Adelaide, petroleum industry employees and a small number of employees from other industries. Individual MBTI distinctions (e.g., extroverts versus introverts) were studied for bias tendencies. We discuss the observed relationships between Myers-Briggs type and decision biases and their relevance to decision making in the petroleum industry. We conclude that while there do seem to be some effects of personality on susceptibility to decision-making biases, these are not necessarily what one might expect given the descriptions attached to specific MBTI types. They are also relatively weak effects and, as such, the use of the Myers-Briggs as a tool for assessing decision-making ability is not supported by our results.