nep-hrm 2025-04-07 papers

on Human Capital and Human Resource Management

Issue of 2025–04–07
two papers chosen by
Patrick Kampkötter, Eberhard Karls Universität Tübingen

Narratives as a Persuasion Tool in Performance Appraisals By Alice Soldà; Marie Claire Villeval
Firms’ Beliefs About Wage Setting By Bertheau, Antoine; Hoeck, Christian Philip

Narratives as a Persuasion Tool in Performance Appraisals

By:	Alice Soldà (Emlyon business school, CNRS, Université Lumière Lyon 2, Université Jean-Monnet Saint-Etienne, GATE, 69007, Lyon, France); Marie Claire Villeval (CNRS, Université Lumière Lyon 2, Université Jean-Monnet Saint-Etienne, emlyon business school, GATE, 69007, Lyon, France; IZA, Bonn, Germany)
Abstract:	We investigated whether individuals use narratives about the role of luck to influence decision-makers’ interpretation of noisy performance signals in a tournament setting. In an experiment, pairs of workers were either rewarded for accurately estimating their relative performance (Control treatment), persuading a manager they outperformed their competitor (Strategic treatment), or both (Trade-Off treatment). Results show that workers were most likely to adopt self-serving narratives attributing signals of lower performance to bad luck in the Strategic treatment. This tendency was reduced in the Trade-Off treatment where accuracy incentives were introduced. While self-serving narratives influenced managers’ decisions regarding the allocation of the winner’s prize, they did not change workers’ beliefs, suggesting that the narratives did not deceive them.
Keywords:	Narratives, persuasion, beliefs, tournament, performance evaluation, online experiment
JEL:	C91 D83 J33 M52
Date:	2025
URL:	https://d.repec.org/n?u=RePEc:gat:wpaper:2505

Firms’ Beliefs About Wage Setting

By:	Bertheau, Antoine (Dept. of Economics, Norwegian School of Economics and Business Administration); Hoeck, Christian Philip (Dept. of Economics, University of Copenhagen)
Abstract:	This paper yields new insights into why similar workers are paid differently by surveying a representative sample of Danish firms and linking responses to administrative data. We find that a substantial minority of firms, about 18 percent, have inaccurate beliefs about their position in the wage distribution. Inaccurate beliefs are more likely to occur in smaller firms. To study the implications of firms’ inaccurate beliefs, we build a simple model with monopsonistic firms. Using our survey, we elicit firms’ motives for setting high wages. The dominant motive aligns with wage-posting models, i.e., retaining and attracting new employees. The least common motive is compensating for negative job characteristics.
Keywords:	Wage dispersion; firm information frictions; biased beliefs
JEL:	D83 J01 J31 J42 M52
Date:	2025–03–06
URL:	https://d.repec.org/n?u=RePEc:hhs:nhheco:2025_005

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