Strategic Manipulation in Peer Performance Evaluation: Evidence from the Field

49 Pages Posted: 6 May 2016 Last revised: 25 Jan 2017

See all articles by Yifei Huang

Yifei Huang

California Institute of Technology

Matthew Shum

California Institute of Technology

Xi Wu

Central University of Finance and Economics (CUFE)

Jason Zezhong Xiao

Cardiff Business School, Cardiff University

Date Written: January 1, 2017

Abstract

This study examines strategic behavior in “360-degree” performance appraisal systems, in which an employee is evaluated by her supervisor, subordinate(s), peers (colleagues) and herself. Using proprietary data from a mid-sized Chinese accounting firm, we find that employees manipulate their ratings to peers: they grant better ratings to their less qualified peers while giving poorer ratings to their more qualified peers, compared with evaluations from employees who are not peers. In addition, this manipulation is mostly done by employees who themselves are less qualified. Altogether, this implies that more-qualified employees “lose” from the 360-degree evaluation scheme, and we show that their promotion chances would be (slightly) higher under the traditional “top-down” scheme in which their performance ratings is based only on the appraisal of their superiors. We discuss implications for improving a 360-degree performance evaluation system.

Keywords: peer performance evaluation, strategic manipulation, personnel economics, sabotage, envy, field data

Suggested Citation

Huang, Yifei and Shum, Matthew and Wu, Xi and Xiao, Jason Zezhong, Strategic Manipulation in Peer Performance Evaluation: Evidence from the Field (January 1, 2017). Available at SSRN: https://ssrn.com/abstract=2776229 or http://dx.doi.org/10.2139/ssrn.2776229

Yifei Huang

California Institute of Technology

Pasadena, CA 91125
United States

Matthew Shum (Contact Author)

California Institute of Technology ( email )

Pasadena, CA 91125
United States

Xi Wu

Central University of Finance and Economics (CUFE) ( email )

Beijing, Beijing
China

Jason Zezhong Xiao

Cardiff Business School, Cardiff University ( email )

Aberconway building
Colum Drive
Cardiff, CF10 3EU
United Kingdom

Register to save articles to
your library

Register

Paper statistics

Downloads
117
rank
233,271
Abstract Views
813
PlumX Metrics
!

Under construction: SSRN citations while be offline until July when we will launch a brand new and improved citations service, check here for more details.

For more information