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Employee Evaluation and Skill Investments: Evidence from Public School Teachers

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  • Eric S. Taylor

Abstract

When an employee expects repeated evaluation and performance incentives over time, the potential future rewards create an incentive to invest in building relevant skills. Because new skills benefit job performance, the effects of an evaluation program can persist after the rewards end or even anticipate the start of rewards. I test for persistence and anticipation effects, along with more conventional predictions, using a quasi-experiment in Tennessee schools. Performance improves with new evaluation measures, but gains are larger when the teacher expects future rewards linked to future scores. Performance rises further when incentives start and remains higher even after incentives end.

Suggested Citation

  • Eric S. Taylor, 2022. "Employee Evaluation and Skill Investments: Evidence from Public School Teachers," NBER Working Papers 30687, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:30687
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    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets
    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics

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