Analysis Merit Rating And Employment Stabilization

Author : Walter L. Peck
Publisher :
ISBN 13 :
Total Pages : 128 pages
Book Rating : 4.:/5 (327 download)

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Download or read book Merit Rating written by Walter L. Peck and published by . This book was released on 1959 with total page 128 pages. Available in PDF, EPUB and Kindle. Book excerpt: The science of economics is concerned with the allocation of resources which are limited relative to alternative ends. Economics, consequently, should be concerned with the development of mechanisms or tools which will facilitate the effectiveness of the economizingprocess. One such mechanism, the price system, is conceptualized by the competitive model. For purposes of this paper it will be assumed that the price mechanism, so conceived, is useful, but not sufficient for the economizing process. As this mechanism is unable to achieve optimum allocation of the factors of production, it is to the interests of economics to develop supplemental mechanisms to improve the allocating function. This paper is concerned with the development of such a mechanism to assist in a better allocation and fuller utilization of the labor factor of production. The primary method for allocating labor, according to conventional economic theory, is through its price, wages. The theory of wages has its basis in the comptetitive model. Under conditions of pure and perfect competition, the supply of and demand for labor will be equilibrated when the competitive wag is equal to the value of the marginal product. For purposes of emphasizing the necessity of supplemental mechanisms, the limitations of market price as a sole allocating mechanism are discussed. These limitations are based upon the discrepancies of the assumptions of the competitive model from conditions of the experiential world. The major assumptions under questions are: pure competition, perfect knowledge, perfect mobility, and the concept of the "economic man". In addition, the limitations of the marginal productivity theory and its role in standard wage theory are discussed. The marginal productivity theory fails to realistically account for wroker differences by inadequately trating the facts that different workers have varied output under the same conditions; that the same worker has different output under different conditions, and that individuals are dynamic and responsive to training. Possible supplemental mechanisms which could be developed include national employment agencies, mechanisms for minimizing the restraint to mobility caused by fringe benefits, improved selection techniques, improved supervision, and employess merit rating. The latter mechanism, merit rating, is the major focus of this study. Thus, a transition is made from large generalizations about economizing labor resources to a detailed analysis of the allocation and the dynamics of the efficient use of labor within an administrative unit. Verious uses of merit rating are described, many of the pitfalls of the tool are noted, and a systematic approach toward developing a merit rating program is presented. Merit rating is then examined intensively. A program ready for installation within a firm, is described. An attempt has been made to incorporate and improve the workable features of existing rating techniques and eliminate or minimize many of the pitfalls of previous techniques. A significant change between this and previous programs concerns the standards by which job performance is evaluated. These standards or criteria have their origin in the science of psychology and represent an attempt to utilize objective, observable and measurable standards in evaluating job performance. Here we see science giving rise to value judgments in the allocating of labor. Finally, it becomes increasingly necessary to develop a managerial philosphy which will be conducive to an atmosphere of creativity and change. An attempt was made to develop the specific tool presented in this paper in such an atmosphere. Two of the ideologies of our society, free competition and individualism are examined. A discussion concerning some of the social, psychological, and economic implications of the refined too concludes this paper.