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The Determinants of Performance Appraisal Systems: A Note (Do Brown and Heywood’s Results for Australia Hold Up for Britain?)

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  • Addison, John T.

    () (University of South Carolina)

  • Belfield, Clive R.

    () (Queens College, CUNY)

Abstract

This paper offers a replication for Britain of Brown and Heywood’s analysis of the determinants of performance appraisal in Australia. Although there are some important limiting differences between our two datasets – the AWIRS and the WERS – we reach one central point of agreement and one intriguing shared insight. First, performance appraisal is negatively associated with tenure: where employers cannot rely on the carrot of deferred pay or the stick of dismissal to motivate workers they will tend to rely more on monitoring, ceteris paribus. Alternatively put, when the probability of job separation is greater, the influence of deferred compensation diminishes. Second, there is also some suggestion in the data that employer monitoring and performance pay may be complementary. However, consonant with the disparate results from the wider literature, there is more modest agreement on the contribution of specific HRM practices, and still less on the role of job control. Finally, there is no carry over to Britain of the structural determinants identified by Brown and Heywood.

Suggested Citation

  • Addison, John T. & Belfield, Clive R., 2007. "The Determinants of Performance Appraisal Systems: A Note (Do Brown and Heywood’s Results for Australia Hold Up for Britain?)," IZA Discussion Papers 3065, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp3065
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    References listed on IDEAS

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    1. Addison, John T., 2005. "The Determinants of Firm Performance: Unions, Works Councils, and Employee Involvement/High Performance Work Practices," IZA Discussion Papers 1620, Institute for the Study of Labor (IZA).
    2. John T. Addison, 2005. "THE DETERMINANTS OF FIRM PERFORMANCE: UNIONS, WORKS COUNCILS, AND EMPLOYEE INVOLVEMENT/HIGH-PERFORMANCE WORK PRACTICES," Scottish Journal of Political Economy, Scottish Economic Society, vol. 52(3), pages 406-450, July.
    3. Stephen Wood, 1999. "Getting the Measure of the Transformed High-Performance Organization," British Journal of Industrial Relations, London School of Economics, vol. 37(3), pages 391-417, September.
    4. Michelle Brown & John S. Heywood, 2005. "Performance Appraisal Systems: Determinants and Change," British Journal of Industrial Relations, London School of Economics, vol. 43(4), pages 659-679, December.
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    Cited by:

    1. Matthias Lang, 2012. "Communicating Subjective Evaluations," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2012_14, Max Planck Institute for Research on Collective Goods, revised Apr 2018.
    2. Alberto Bayo-Moriones & Jose Enrique Galdon-Sanchez & Sara Martinez-De-Morentin, 2013. "The Diffusion of Pay for Performance across Occupations," ILR Review, Cornell University, ILR School, vol. 66(5), pages 1115-1148, October.
    3. John S. Heywood & Uwe Jirjahn, 2014. "Variable Pay, Industrial Relations and Foreign Ownership: Evidence from Germany," British Journal of Industrial Relations, London School of Economics, vol. 52(3), pages 521-552, September.
    4. David Marsden, 2013. "Individual Voice in Employment Relationships: A Comparison under Different Forms of Workplace Representation," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 52, pages 221-258, January.
    5. repec:eee:jeborg:v:142:y:2017:i:c:p:205-225 is not listed on IDEAS
    6. Bayo-Moriones, Alberto & Galdon-Sanchez, Jose Enrique & Martinez-de-Morentin, Sara, 2011. "Performance Appraisal: Dimensions and Determinants," IZA Discussion Papers 5623, Institute for the Study of Labor (IZA).
    7. David Marsden & Richard Belfield, 2010. "Institutions and the Management of Human Resources: Incentive Pay Systems in France and Great Britain," British Journal of Industrial Relations, London School of Economics, vol. 48(2), pages 235-283, June.
    8. Patrick Kampkötter & Kathrin Marggraf & Jan-Hendrik Zimmermann, 2017. "Determinants and effects of formal target agreements: an empirical investigation of German firms," Review of Managerial Science, Springer, vol. 11(1), pages 1-18, January.
    9. Uwe Jirjahn & Erik Poutsma, 2013. "The Use of Performance Appraisal Systems: Evidence from Dutch Establishment Data," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 52(4), pages 801-828, October.
    10. 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.
    11. David Marsden, 2010. "Individual Voice in Employment Relationships: A Comparison Under Different Collective Voice Regimes," CEP Discussion Papers dp1006, Centre for Economic Performance, LSE.
    12. Peter Cappelli & Martin Conyon, 2016. "What Do Performance Appraisals Do?," NBER Working Papers 22400, National Bureau of Economic Research, Inc.
    13. Marc-Arthur Diaye & Nathalie Greenan, 2012. "The Economics of Performance Appraisals," Working Papers halshs-00856229, HAL.
    14. Alejandro Arrieta & Ariadna García-Prado, 2012. "Cost Sharing and Hospitalizations for Ambulatory Care Sensitive Conditions," Documentos de Trabajo - Lan Gaiak Departamento de Economía - Universidad Pública de Navarra 1211, Departamento de Economía - Universidad Pública de Navarra.

    More about this item

    Keywords

    HRM practices; performance appraisal; monitoring; deferred compensation; performance pay; worker tenure; unionism;

    JEL classification:

    • J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics

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