THE EFFECT THAT COMPETITION HAS ON INTENTIONAL RATING DISTORTION IN PEER APPRAISAL

Abstract

Peer appraisal is a performance appraisal tool thought of as being able to provide intimate and accurate information about employees’ and students’ performances. This study seeks to investigate the accuracy of peer appraisal by studying the effect of competition on rating distortion, as competition between peer raters and ratees is an inherent part of peer appraisal. Study 1 investigates whether the simple act of imagining oneself in a competitive situation is enough to elicit rating distortion. Study 2 seeks to overcome the limitation of study 1 by creating real-life competition among participants. While results are not strongly conclusive due to the lack of statistical power and adequate incentives, certain accidental findings suggest that peer appraisals are susceptible to rating variations. The implications of the results and future research directions are also discussed.