Review of Economic Studies Vol. 88 No. 4 2021
Motivational Ratings
Abstract
Performance evaluation (“rating”) systems not only provide information to users but also motivate the rated worker. This article solves for the optimal (effort-maximizing) rating within the standard career concerns framework. We prove that this rating is a linear function of past observations. The rating, however, is not a Markov process, but rather the sum of two Markov processes. We show how it combines information of different types and vintages. An increase in effort may adversely affect some (but not all) future ratings.
- DOI
- 10.1093/restud/rdaa070
- Volume
- 88
- Issue
- 4
- Pages
- 1892-1935
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref