What Is a Good Rank? The Effort and Performance Effects of Adding Performance Category Labels to Relative Performance Information*

Prior research demonstrates that relative performance information affects effort and performance. However, little is known about the qualitative design parameters of these systems. This study examines, via an experiment, how adding category labels to ranks (e.g., “good” ranking position “poor” position) Furthermore, we investigate effects two choices observed in practice: type proportion positively labeled ranks. We argue motivate greater through competition for status, which varies with both find partial support our hypothesis increases Specifically, positive if top are bottom negatively (combined labels) but not only (positive-only labels). also as predicted on resulting from using combined labels, instead positive-only stronger when larger. The results weaker. Our shed new light usefulness emphasize firms can render more effective.