Article ID: | iaor2013506 |
Volume: | 59 |
Issue: | 1 |
Start Page Number: | 54 |
End Page Number: | 68 |
Publication Date: | Jan 2013 |
Journal: | Management Science |
Authors: | Sliwka Dirk, Harbring Christine, Berger Johannes |
Keywords: | management |
A real‐effort experiment is investigated in which supervisors have to rate the performance of individual workers who in turn receive a bonus payment based on these ratings. We compare a baseline treatment in which supervisors are not restricted in their rating behavior to a forced distribution system in which they have to assign differentiated grades. We find that productivity is significantly higher under a forced distribution by about 6% to 12%. However, the productivity effects are less clear cut when participants have prior experience with the baseline condition. Moreover, a forced distribution becomes detrimental when workers have access to a simple option to sabotage each other.