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Locus of control and performance appraisal

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  • Heywood, John S.
  • Jirjahn, Uwe
  • Struewing, Cornelia

Abstract

We show that West German workers with an internal locus of control sort into jobs with performance appraisals. Appraisals provide workers who believe they control their environment a tool to demonstrate their value and achieve their goals. We confirm that workers who are risk tolerant also sort into jobs with performance appraisals but explain why the influence of the locus of control and risk tolerance should not be additive. We demonstrate this by estimating a routinely large and significantly negative interaction in our sorting equations. We also show that important patterns of sorting are revealed only when taking into account the interaction of locus of control and risk tolerance.

Suggested Citation

  • Heywood, John S. & Jirjahn, Uwe & Struewing, Cornelia, 2017. "Locus of control and performance appraisal," Journal of Economic Behavior & Organization, Elsevier, vol. 142(C), pages 205-225.
  • Handle: RePEc:eee:jeborg:v:142:y:2017:i:c:p:205-225
    DOI: 10.1016/j.jebo.2017.06.011
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    Cited by:

    1. Uwe Jirjahn & Jens Mohrenweiser, 2015. "Performance Pay and Applicant Screening," Research Papers in Economics 2015-11, University of Trier, Department of Economics.
    2. Malte Preuss & Juliane Hennecke, 2017. "Biased by Success and Failure: How Unemployment Shapes Stated Locus of Control," SOEPpapers on Multidisciplinary Panel Data Research 943, DIW Berlin, The German Socio-Economic Panel (SOEP).
    3. Katharina Jaik & Stefan C. Wolter, 2018. "From Dreams to Reality: Market Forces and Changes from Occupational Intention to Occupational Choice," Economics of Education Working Paper Series 0149, University of Zurich, Department of Business Administration (IBW).

    More about this item

    Keywords

    Locus of control; Risk attitude; Performance appraisal; Performance pay; Sorting; Extrinsic rewards; Intrinsic motivation;

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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