Working Paper: NBER ID: w22400
Authors: Peter Cappelli; Martin Conyon
Abstract: This paper investigates employee performance appraisals using data from a single US firm between 2001 and 2007. We find that performance appraisals are both informative and drive important components of the employment contract. We find that employee appraisal scores vary considerably both between and within individuals over time. In addition, we show that employee performance appraisal scores are related to a range of important employment outcomes, including merit pay and bonuses, promotions, demotions and dismissals, as well as employee quits.
Keywords: performance appraisals; employment outcomes; merit pay; promotions; quits
JEL Codes: J33; J41; J63
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| performance appraisals (M52) | merit pay increases (J33) |
| performance appraisals (M52) | bonuses (M52) |
| performance appraisals (M52) | promotions (M51) |
| performance appraisals (M52) | demotions (J62) |
| performance appraisals (M52) | dismissals (J63) |
| performance appraisals (M52) | employee quits (J63) |
| higher appraisal scores (C52) | better financial rewards (G19) |
| improvements in performance (D29) | recognition and rewards (M52) |