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American Economic Review: Vol. 102 No. 7 (December 2012)

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Information and Employee Evaluation: Evidence from a Randomized Intervention in Public Schools

Article Citation

Rockoff, Jonah E., Douglas O. Staiger, Thomas J. Kane, and Eric S. Taylor. 2012. "Information and Employee Evaluation: Evidence from a Randomized Intervention in Public Schools." American Economic Review, 102(7): 3184-3213.

DOI: 10.1257/aer.102.7.3184

Abstract

We examine how employers learn about worker productivity in a randomized pilot experiment which provided objective estimates of teacher performance to school principals. We test several hypotheses that support a simple Bayesian learning model with imperfect information. First, the correlation between performance estimates and prior beliefs rises with more precise objective estimates and more precise subjective priors. Second, new information exerts greater influence on posterior beliefs when it is more precise and when priors are less precise. Employer learning affects job separation and productivity in schools, increasing turnover for teachers with low performance estimates and producing small test score improvements. (JEL D83, I21, J24, J45)

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Authors

Rockoff, Jonah E. (Columbia U)
Staiger, Douglas O. (Dartmouth College)
Kane, Thomas J. (Harvard U)
Taylor, Eric S. (Stanford U)

JEL Classifications

D83: Search; Learning; Information and Knowledge; Communication; Belief
I21: Analysis of Education
J24: Human Capital; Skills; Occupational Choice; Labor Productivity
J45: Public Sector Labor Markets


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