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Locus of Control and Performance Appraisal

Author

Listed:
  • John S. Heywood
  • Uwe Jirjahn
  • Cornelia Struewing

Abstract

This work contributes to the literature demonstrating an important role for psychological traits in labor market decisions. 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

  • John S. Heywood & Uwe Jirjahn & Cornelia Struewing, 2016. "Locus of Control and Performance Appraisal," Research Papers in Economics 2016-03, University of Trier, Department of Economics.
  • Handle: RePEc:trr:wpaper:201603
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    Cited by:

    1. Uwe Jirjahn & Cornelia Chadi, 2020. "Out-of-partnership births in East and West Germany," Review of Economics of the Household, Springer, vol. 18(3), pages 853-881, September.
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    3. Marco Caliendo & Juliane Hennecke, 2020. "Drinking is Different! Examining the Role of Locus of Control for Alcohol Consumption," CEPA Discussion Papers 18, Center for Economic Policy Analysis.
    4. Benjamin Artz & Colin P. Green & John S. Heywood, 2021. "Does performance pay increase alcohol and drug use?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 34(3), pages 969-1002, July.
    5. Frondel, Manuel & Osberghaus, Daniel & Sommer, Stephan, 2021. "Corona and the stability of personal traits and preferences: Evidence from Germany," Ruhr Economic Papers 903, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    6. Uwe Jirjahn & Jens Mohrenweiser, 2019. "Performance Pay and Applicant Screening," British Journal of Industrial Relations, London School of Economics, vol. 57(3), pages 540-575, September.
    7. Preuss, Malte & Hennecke, Juliane, 2018. "Biased by success and failure: How unemployment shapes locus of control," Labour Economics, Elsevier, vol. 53(C), pages 63-74.
    8. 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).
    9. Grund, Christian & Sliwka, Dirk & Titz, Krystina, 2019. "Works Councils and Performance Appraisals," IZA Discussion Papers 12670, Institute of Labor Economics (IZA).
    10. Caliendo, Marco & Cobb-Clark, Deborah A. & Hennecke, Juliane & Uhlendorff, Arne, 2019. "Locus of control and internal migration," Regional Science and Urban Economics, Elsevier, vol. 79(C).
    11. Juliane Hennecke, 2020. "Locus of Control and Female Labor Force Participation," Working Papers 2020-03, Auckland University of Technology, Department of Economics.
    12. Balletta, Luigi & Modica, Salvatore, 2018. "Selection by committee: Anonymity and gratitude," Research in Economics, Elsevier, vol. 72(4), pages 511-517.
    13. 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), revised Oct 2018.
    14. Uwe Jirjahn, Cornelia Struewing, 2018. "Single Motherhood in East and West Germany: What Can Explain the Differences?," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 15(2), pages 197-229, December.
    15. Awaworyi Churchill, Sefa & Munyanyi, Musharavati Ephraim & Prakash, Kushneel & Smyth, Russell, 2020. "Locus of control and the gender gap in mental health," Journal of Economic Behavior & Organization, Elsevier, vol. 178(C), pages 740-758.
    16. Benjamin Artz & Colin P. Green & John S. Heywood, 0. "Does performance pay increase alcohol and drug use?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 0, pages 1-34.
    17. Gong, Xiaodong & Zhu, Rong, 2019. "Cognitive abilities, non-cognitive skills, and gambling behaviors," Journal of Economic Behavior & Organization, Elsevier, vol. 165(C), pages 51-69.

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    More about this item

    Keywords

    Locus of control; risk attitude; performance appraisal; performance pay; sorting; extrinsic rewards; intrinsic motivation;
    All these keywords.

    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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