Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • 2021
  • Working Paper

Supply- and Demand-Side Effects in Performance Appraisals: The Role of Gender and Race

By: Iris Bohnet, Oliver P. Hauser and Ariella Kristal
  • Format:Print
  • | Language:English
ShareBar

Abstract

Performance reviews in firms are common but controversial. Managers’ subjective appraisals of their employees’ performance and employees’ self-evaluations might be affected by demographic characteristics, interact with each other as self-evaluations are typically shared with managers before they decide (“anchoring”), and these supply-side and demand-side dynamics may contribute to gender or race differences in performance ratings. Analyzing the data of a multi-national financial services firm, we find that supply-side effects were mostly driven by gender: women (particularly, women of color) gave themselves lower self-ratings. Demand-side effects were shaped by gender and race: holding self-evaluations constant, managers lowered the ratings of female and White employees less, reversing the gender gap in ratings induced by the supply side for Whites but introducing a race gap. The race-based demand-side effects were particularly pronounced in the US, negatively affecting Black, Asian and Latinx employees. Counterfactual simulations suggest that 22-28% of Black employees’ ratings would have to be increased for this race gap to disappear. Finally, we evaluate a potential intervention. In 2016, a quasi-exogenous shock led to self-evaluations not being shared with managers before they appraised employees. While this disruption of supply-side influences led to “de-anchoring” with lower average manager ratings, it generally did not change any gender or race dynamics, as these were mostly shaped by demand-side factors. A possible exception were employees of color hired in 2016: when managers were not anchored by self-ratings (and were unaffected by previous years), the race gap disappeared for women (but not for men) of color.

Keywords

Performance Appraisals; Gender; Race; Performance Evaluation

Citation

Bohnet, Iris, Oliver P. Hauser, and Ariella Kristal. "Supply- and Demand-Side Effects in Performance Appraisals: The Role of Gender and Race." HKS Faculty Research Working Paper Series, No. RWP21-016, May 2021.
  • Read Now

More from the Authors

    • April 27, 2022
    • Journal of Economic Surveys

    Inequality in Researchers' Minds: Four Guiding Questions for Studying Subjective Perceptions of Economic Inequality

    By: Jon M. Jachimowicz, Shai Davidai, Daniela Goya-Tocchetto, Barnabas Szaszi, Martin Day, Stephanie Tepper, L. Taylor Phillips, M. Usman Mirza, Nailya Ordabayeva and Oliver P. Hauser
    • Nature

    Megastudies Improve the Impact of Applied Behavioural Science

    By: Katherine L. Milkman, Dena Gromet, Hung Ho, Joseph S. Kay, Timothy W. Lee, Pepi Pandiloski, Yeji Park, Aneesh Rai, Max Bazerman, John Beshears, Lauri Bonacorsi, Colin Camerer, Edward Chang, Gretchen Chapman, Robert Cialdini, Hengchen Dai, Lauren Eskreis-Winkler, Ayelet Fishbach, James J. Gross, Samantha Horn, Alexa Hubbard, Steven J. Jones, Dean Karlan, Tim Kautz, Erika Kirgios, Joowon Klusowski, Ariella Kristal, Rahul Ladhania, Jens Ludwig, George Loewenstein, Barbara Mellers, Sendhil Mullainathan, Silvia Saccardo, Jann Spiess, Gaurav Suri, Joachim H. Talloen, Jamie Taxer, Yaacov Trope, Lyle Ungar, Kevin G. Volpp, Ashley Whillans, Jonathan Zinman and Angela L. Duckworth
    • 2021
    • Faculty Research

    Going Beyond the ‘Self’ in Self-Control: Interpersonal Consequences of Commitment Strategy Use

    By: Ariella Kristal and Julian Zlatev
More from the Authors
  • Inequality in Researchers' Minds: Four Guiding Questions for Studying Subjective Perceptions of Economic Inequality By: Jon M. Jachimowicz, Shai Davidai, Daniela Goya-Tocchetto, Barnabas Szaszi, Martin Day, Stephanie Tepper, L. Taylor Phillips, M. Usman Mirza, Nailya Ordabayeva and Oliver P. Hauser
  • Megastudies Improve the Impact of Applied Behavioural Science By: Katherine L. Milkman, Dena Gromet, Hung Ho, Joseph S. Kay, Timothy W. Lee, Pepi Pandiloski, Yeji Park, Aneesh Rai, Max Bazerman, John Beshears, Lauri Bonacorsi, Colin Camerer, Edward Chang, Gretchen Chapman, Robert Cialdini, Hengchen Dai, Lauren Eskreis-Winkler, Ayelet Fishbach, James J. Gross, Samantha Horn, Alexa Hubbard, Steven J. Jones, Dean Karlan, Tim Kautz, Erika Kirgios, Joowon Klusowski, Ariella Kristal, Rahul Ladhania, Jens Ludwig, George Loewenstein, Barbara Mellers, Sendhil Mullainathan, Silvia Saccardo, Jann Spiess, Gaurav Suri, Joachim H. Talloen, Jamie Taxer, Yaacov Trope, Lyle Ungar, Kevin G. Volpp, Ashley Whillans, Jonathan Zinman and Angela L. Duckworth
  • Going Beyond the ‘Self’ in Self-Control: Interpersonal Consequences of Commitment Strategy Use By: Ariella Kristal and Julian Zlatev
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Digital Accessibility
Copyright © President & Fellows of Harvard College