TY  - RPRT
        AU  - Kampkötter, Patrick
AU  - Sliwka, Dirk
        TI  - Differentiation and Performance: An Empirical Investigation on the Incentive Effects of Bonus Plans
        PY  - 2011/Oct/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 6070
        UR  - https://www.iza.org/index.php/publications/dp6070
        AB  - It is often claimed that supervisors do not differentiate enough between high and low performing employees when evaluating performance. The purpose of this paper is to study the incentive effects of this behavior empirically. We first show in a simple model that the perceived degree of past differentiation affects future incentives. We then study the impact of differentiation empirically with a large panel data set spanning many firms in one industry. On average, stronger differentiation has a substantial positive effect on performance. This effect is larger on higher hierarchical levels. But differentiation may become harmful at the lowest levels.
        KW  - subjective performance evaluation
KW  - differentiation
KW  - bonus payments
KW  - incentives
        ER  -