Dirk Sliwka, University of Cologne

"Multitasking and Subjective Performance - Evaluations - Evidence from a Field Experiment"

Abstract

We compare the incentive effects of subjective and objective performance measurement investigating a field experiment in a bank. At the outset managers assigned bonuses to their employees based on subjective assessments. In a subset of the branches, managers then obtained access to individual objective performance measures. We find a significant positive impact of objective performance measurement on effort and profits. This productivity increase is driven by larger branches and higher sales for non-core products.
We argue that this pattern is in line with a novel formal economic model on the optimal allocation of attention on multiple tasks under subjective evaluations.

Contact person: Alexander Sebald