Arbeitspapier
Peer Evaluation: Incentives and Co-Worker Relations
In many workplaces co-workers have the best information about each other's effort. Managers may attempt to exploit this information through peer evaluation. I study peer evaluation in a pure moral hazard model of production by two limitedly liable agents. Agents receive a signal about their colleague's effort level, and are asked to report it to the principal. The principal may give an individual bonus for the receipt of a positive evaluation by a colleague, which stimulates effort as long as signals are revealed truthfully. A cost of lying ascertains that there can be truthful revelation. I show that interpersonal relations between colleagues constrain the bonus for receiving a positive evaluation in order to keep evaluations truthful. Still, the principal will always include such a bonus in the optimal contract, and possibly complement it with a team bonus. Co-worker relations have non-monotic effects on profits in the optimal contract.
- Language
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Englisch
- Bibliographic citation
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Series: Tinbergen Institute Discussion Paper ; No. 10-055/1
- Classification
-
Wirtschaft
Economics of Contract: Theory
Compensation Packages; Payment Methods
Personnel Economics: General
- Subject
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peer evaluation
peer appraisal
incentive contracts
co-worker relations
likeability bias
Arbeitskräfte
Soziale Beziehungen
Informationsverbreitung
Anreizvertrag
Prinzipal-Agent-Theorie
- Event
-
Geistige Schöpfung
- (who)
-
Sol, Joeri
- Event
-
Veröffentlichung
- (who)
-
Tinbergen Institute
- (where)
-
Amsterdam and Rotterdam
- (when)
-
2010
- Handle
- Last update
-
10.03.2025, 11:45 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Sol, Joeri
- Tinbergen Institute
Time of origin
- 2010
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