Performance Appraisals and the Impact of Forced Distribution: An Experimental Investigation

46 Pages Posted: 6 Jul 2010

See all articles by Johannes Berger

Johannes Berger

University of Cologne - Department of Business Administration and Human Resource Management

Christine Harbring

University of Cologne; IZA Institute of Labor Economics

Dirk Sliwka

University of Cologne - Faculty of Management, Economics and Social Sciences; IZA Institute of Labor Economics

Abstract

A real effort experiment is investigated in which supervisors have to rate the performance of individual workers who in turn receive a bonus payment based on these ratings. We compare a baseline treatment in which supervisors were not restricted in their rating behavior to a forced distribution system in which they had to assign differentiated grades. We find that productivity was significantly higher under a forced distribution by about 8%. But also in the absence of forced distribution, deliberate differentiation positively affected output in subsequent work periods.

Keywords: performance measurement, forced distribution, motivation, experiment

JEL Classification: C91, D83, J33, M52

Suggested Citation

Berger, Johannes and Harbring, Christine and Sliwka, Dirk, Performance Appraisals and the Impact of Forced Distribution: An Experimental Investigation. IZA Discussion Paper No. 5020. Available at SSRN: https://ssrn.com/abstract=1634487

Johannes Berger (Contact Author)

University of Cologne - Department of Business Administration and Human Resource Management ( email )

Koln, 50923
Germany

Christine Harbring

University of Cologne ( email )

Albertus-Magnus-Platz
Cologne, 50923
Germany
+ 49 (0) 221 / 470 - 7955 (Phone)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Dirk Sliwka

University of Cologne - Faculty of Management, Economics and Social Sciences ( email )

Richard-Strauss-Str. 2
Cologne, D-50923
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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