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American Economic Review Vol. 102 No. 7 2012

Information and Employee Evaluation: Evidence from a Randomized Intervention in Public Schools

Jonah E. Rockoff1; Douglas O. Staiger2; Thomas J. Kane3; Eric S. Taylor4

1 Columbia Business School, 3022 Broadway, New York, NY 10027 · 2 Dartmouth College, 6106 Rockefeller Hall, Hanover, NH 03755. · 3 Harvard University, 50 Church Street 4th Floor, Cambridge, MA 02138. · 4 Stanford University, 520 Galvez Mall, Stanford, CA 94305.

Abstract

We examine how employers learn about worker productivity in a randomized pilot experiment which provided objective estimates of teacher performance to school principals. We test several hypotheses that support a simple Bayesian learning model with imperfect information. First, the correlation between performance estimates and prior beliefs rises with more precise objective estimates and more precise subjective priors. Second, new information exerts greater influence on posterior beliefs when it is more precise and when priors are less precise. Employer learning affects job separation and productivity in schools, increasing turnover for teachers with low performance estimates and producing small test score improvements.

DOI
10.1257/aer.102.7.3184
Volume
102
Issue
7
Pages
3184-3213
Language
en
Sources
openalex bibtex:phds-export.bib crossref

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