Feedback, Self-Esteem and Performance in Organizations

Management Science, 58 (1): 94-113, January 2012

33 Pages Posted: 29 Jan 2009 Last revised: 23 Apr 2014

See all articles by Camelia M. Kuhnen

Camelia M. Kuhnen

University of North Carolina Kenan-Flagler Business School & NBER

Agnieszka Tymula

Bocconi University

Date Written: July 9, 2010

Abstract

We examine whether private feedback about relative performance can mitigate moral hazard in competitive environments by modifying the agents’ self-esteem. In our experimental setting people work harder and expect to rank better when told they may learn their ranking, relative to cases when feedback will not be provided. Individuals who ranked better than expected decrease output but expect a better rank in the future, while those who ranked worse than expected increase output but lower their future rank expectations. Feedback helps create a ratcheting effect in productivity, mainly due to the fight for dominance at the top of the rank hierarchy. Our findings suggest that organizations can improve employee productivity by changing the likelihood of feedback, the reference group used to calculate relative performance, and the informativeness of the feedback message.

Keywords: rankings, feedback, performance management, ego utility, self-esteem

JEL Classification: M12, M52, C91

Suggested Citation

Kuhnen, Camelia M. and Tymula, Agnieszka, Feedback, Self-Esteem and Performance in Organizations (July 9, 2010). Management Science, 58 (1): 94-113, January 2012. Available at SSRN: https://ssrn.com/abstract=1333795 or http://dx.doi.org/10.2139/ssrn.1333795

Camelia M. Kuhnen (Contact Author)

University of North Carolina Kenan-Flagler Business School & NBER ( email )

Kenan-Flagler Business School
Chapel Hill, NC 27599-3490
United States
(919) 9623284 (Phone)

HOME PAGE: http://public.kenan-flagler.unc.edu/faculty/kuhnenc/

Agnieszka Tymula

Bocconi University ( email )

via sarfatti 25
Milan, 20136
Italy

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