Power differences are ubiquitous in social settings. However, the question of whether groups with higher or lower power disparity achieve better performance has thus far received conflicting answers. To address this issue, we identify 3 underlying assumptions in the literature that may have led to these divergent findings, including a myopic focus on static hierarchies, an assumption that those at the top of hierarchies are competent at group tasks, and an assumption that equality is not possible. We employ a multimethod set of studies to examine these assumptions and to understand when power disparity will help or harm group performance. First, our agent-based simulation analyses show that by unpacking these common implicit assumptions in power research, we can explain earlier disparate findings--power disparity benefits group performance when it is dynamically aligned with the power holder's task competence, and harms group performance when held constant and/or is not aligned with task competence. Second, our empirical findings in both a field study of fraud investigation groups and a multiround laboratory study corroborate the simulation results. We thereby contribute to research on power by highlighting a dynamic understanding of power in groups and explaining how current implicit assumptions may lead to opposing findings.
