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Individual and Job-Based Determinants of Performance Appraisal: Evidence from Germany

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Author Info

  • Grund, Christian

    ()
    (RWTH Aachen University)

  • Sliwka, Dirk

    ()
    (University of Cologne)

Abstract

We investigate the use of performance appraisal (PA) in German Firms. First, we derive hypotheses on individual and job based determinants of PA usage. Based on a representative German data set on individual employees, we test these hypotheses and also explore the impact of PA on performance pay and further career prospects. The results include that PA is positively linked to an individual’s willingness to take risks. The performance of older employees and woman is evaluated less often. Furthermore, larger firms evaluate the performance of their employees more. We find evidence for a non-monotonic relation between the hierarchical level and usage of performance appraisal: The performance of employees with very high or very low responsibilities is assessed less often.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3017.

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Length: 22 pages
Date of creation: Aug 2007
Date of revision:
Publication status: published as "The Anatomy of Performance Appraisals in Germany" in: International Journal of Human Resource Management, 2009, 20 (10), 2049-2065
Handle: RePEc:iza:izadps:dp3017

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Keywords: performance evaluation; GSOEP; performance appraisal;

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References

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  1. Murphy, Kevin J., 1999. "Executive compensation," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 38, pages 2485-2563 Elsevier.
  2. Michelle Brown & John S. Heywood, 2005. "Performance Appraisal Systems: Determinants and Change," British Journal of Industrial Relations, London School of Economics, London School of Economics, vol. 43(4), pages 659-679, December.
  3. Muriel Niederle & Lise Vesterlund, 2005. "Do Women Shy Away From Competition? Do Men Compete Too Much?," NBER Working Papers 11474, National Bureau of Economic Research, Inc.
  4. Holmstrom, Bengt & Milgrom, Paul, 1991. "Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design," Journal of Law, Economics and Organization, Oxford University Press, Oxford University Press, vol. 7(0), pages 24-52, Special I.
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Cited by:
  1. Olaf Hübler, 2012. "Are Tall People Less Risk Averse than Others?," SOEPpapers on Multidisciplinary Panel Data Research 457, DIW Berlin, The German Socio-Economic Panel (SOEP).
  2. Hunnes, Arngrim & Kvaløy, Ola & Mohn, Klaus, 2009. "Performance appraisal and career opportunities: A case study," UiS Working Papers in Economics and Finance, University of Stavanger 2009/11, University of Stavanger.
  3. Ola Kvaloy & Trond Olsen, 2007. "The Rise of Individual Performance Pay," CESifo Working Paper Series 2145, CESifo Group Munich.

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