Crifo, Patricia <br/><br/>
Why Do Firms Evaluate Their Employees Individually? 

 -  2004.<br/>							 
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<br/><br/> This paper puts forward an alternative evaluation interview theory to the one of an ex post performance measurement when autonomy increases, since wages remain fairly rigid. Our agency model with teamwork shows that strong horizontal interdependence and super-modularity do not ensure coordination to reach Pareto-optimal equilibrium. The cost of monetary incentives for coordination increases as a function of these characteristics, which means that it is in the principal’s interest to develop a less costly system, such as individual evaluation interviews, since they generate an ex ante signal to convince workers of the existence of a team spirit. The model predictions were tested empirically using the data from the 1997 Computerisation and Organisational Change Survey. Individual evaluation interviews seem to be determined more by the degree of teamwork than by the degree of autonomy and they are not associated with monetary gains, but rather a belief system relating to work.