ABSTRACT We examine whether and how a widely established finding—employees respond negatively to managerial monitoring—generalizes to different performance-evaluation systems. We predict that relative performance evaluations (RPEs), a common evaluation feature in multiagent settings, attenuate employees’ negative responses to managerial monitoring. The results of our experiment support our theory. Consistent with prior literature, we find that without RPE, employees respond significantly more negatively to managerial monitoring compared to no monitoring. However, we find that the effect of managerial monitoring on employee responses is moderated in the presence of RPE—employees respond similarly regardless of whether their manager implements a monitoring control. We provide robust analyses to support our theory-derived mechanisms, demonstrating that our results are driven by employees’ fairness perceptions of managers’ monitoring decisions. Collectively, this study aids in the understanding of how and under what circumstances managerial monitoring may be more or less beneficial. Data Availability: Available upon request. JEL Classifications: C90; D91; J31; M40.

Abstract Reciprocity plays a critical role in the way employees respond to managerial control decisions. The current consensus is that employees punish managers for implementing unkind controls (negative reciprocity) more than they reward managers for implementing kind controls (positive reciprocity). We challenge this consensus. Prior research focuses on settings that emphasize employees' immediate reciprocal responses. However, in the workplace, employees often respond over long periods of time to sticky control decisions (e.g., budgets, pay, decision rights). Focusing on these long‐term settings, we predict and find that, while negative reciprocity is initially stronger than positive reciprocity, it also fades more over time than positive reciprocity. This differential fading is so pronounced in our setting that positive reciprocity is stronger overall in the long run. Thus, in long‐term settings, positive responses to kind controls may play a more important role than negative responses to unkind controls. Our results inform managerial decisions about the use of kind versus unkind controls and suggest potential long‐term benefits of pay disparity and other policies that treat employees differentially.

ABSTRACT Results from multiple experiments demonstrate that evaluators more favorably evaluate creative output produced by designers with higher expertise, even when the underlying creativity of the output is held constant (hereafter, expertise bias). We find, however, that this bias is mitigated when evaluators know that Artificial Intelligence (AI) can augment creative design processes, because AI’s capabilities reduce the perceived exclusivity of designers’ domain expertise. We also show that designers can restore the perceived exclusivity of their expertise, reestablishing the expertise bias, by choosing not to use available AI tools. Although prior research focuses on AI’s ability to enhance or inhibit the creativity of output, we highlight that it can enhance the creative process by mitigating a prevalent human bias in the subjective evaluation of this output. We also contribute to a better understanding of why some experienced designers refuse to utilize AI. Data Availability: Data are available upon request. JEL Classifications: L29; M41; M55.