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Confidence Management: On Interpersonal Comparisons in Teams

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Author Info

  • Beno�t S.Y. Crutzen

    ()
    (Erasmus Universiteit Rotterdam)

  • Otto H. Swank

    ()
    (Erasmus Universiteit Rotterdam)

  • Bauke Visser

    ()
    (Erasmus Universiteit Rotterdam)

Abstract

Organization differ in the degree to which they differentiate employees by ability. We analyse how the effect of differentiation on employee morale may explain this variation. By comparing employees using ordinary talk, a manager boosts the self-image of some, but hurts that of others. Whether the net effect is positive for the organization depends on the degree of synergy between employees and on the shape of their objective function. An implication for relative performance pay is that it yields a double dividend or constitutes a double-edged sword.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 07-040/1.

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Date of creation: 30 May 2007
Date of revision:
Handle: RePEc:dgr:uvatin:20070040

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Web page: http://www.tinbergen.nl

Related research

Keywords: Comparisons; Confidence; Teams; Cheap talk;

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Cited by:
  1. Ghazala Azmat & Nagore Iriberri, 2010. "The Provision of Relative Performance Feedback Information: An Experimental Analysis of Performance and Happiness," Working Papers 454, Barcelona Graduate School of Economics.
  2. Kampkötter, Patrick & Sliwka, Dirk, 2011. "Differentiation and Performance: An Empirical Investigation on the Incentive Effects of Bonus Plans," IZA Discussion Papers 6070, Institute for the Study of Labor (IZA).
  3. Jurjen J.A. Kamphorst & Otto H. Swank, 2012. "The Role of Performance Appraisals in Motivating Employees," Tinbergen Institute Discussion Papers 12-034/1, Tinbergen Institute.
  4. Stephen Eliot Hansen, 2010. "The Benefits of Limited Feedback in Organizations," Working Papers 490, Barcelona Graduate School of Economics.
  5. Archishman Chakraborty & Rick Harbaugh, 2010. "Persuasion by Cheap Talk," American Economic Review, American Economic Association, vol. 100(5), pages 2361-82, December.
    • Archishman Chakraborty & Rick Harbaugh, 2006. "Persuasion by Cheap Talk," Working Papers 2006-10, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy, revised Oct 2009.

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