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Peer Evaluations And Team Performance: When Friends Do Worse Than Strangers

  • BRICE CORGNET

We use peer assessments as a tool to allocate joint profits in a real effort team experiment. We find that using this incentive mechanism reduces team performance. More specifically, we show that teams composed of fellows rather than strangers actually underperform in a context of peer evaluations. We conjecture that peer evaluations undermine the inherently high level of intrinsic motivation that characterizes teams composed of friends. We finally analyze the determinants of peer assessments and stress the crucial importance of equality concerns.

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File URL: http://hdl.handle.net/10.1111/j.1465-7295.2010.00354.x
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Article provided by Western Economic Association International in its journal Economic Inquiry.

Volume (Year): 50 (2012)
Issue (Month): 1 (01)
Pages: 171-181

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Handle: RePEc:bla:ecinqu:v:50:y:2012:i:1:p:171-181
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  1. Oliver Bochet & Talbot Page & Louis Putterman, 2002. "Communication and Punishment in Voluntary Contribution Experiments," Working Papers 2002-29, Brown University, Department of Economics.
  2. Gaynor, Martin & Pauly, Mark V, 1990. "Compensation and Productive Efficiency of Partnerships: Evidence from Medical Group Practice," Journal of Political Economy, University of Chicago Press, vol. 98(3), pages 544-73, June.
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  5. Encinosa III, William E. & Gaynor, Martin & Rebitzer, James B., 2007. "The sociology of groups and the economics of incentives: Theory and evidence on compensation systems," Journal of Economic Behavior & Organization, Elsevier, vol. 62(2), pages 187-214, February.
  6. Jonathan Levin, 2000. "Relational Incentive Contracts," Working Papers 01002, Stanford University, Department of Economics.
  7. Booth, Alison L & Frank, Jeff, 1997. "Performance-Related Pay," CEPR Discussion Papers 1593, C.E.P.R. Discussion Papers.
  8. Claude Montmarquette & Jean-Louis Rullière & Marie-Claire Villeval & Romain Zeiliger, 2004. "Redesigning Teams and Incentives in a Merger: An Experiment with Managers and Students," Management Science, INFORMS, vol. 50(10), pages 1379-1389, October.
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