Brown, Charles. 1982. "Estimating the Determinants of Employee Performance." Journal of Human Resources 17(2):178-194.

Employers often wish to know whether the factors used in selecting employees do in fact allow them to choose the most qualified applicants. Because the performance of those not chosen is not observed, sample-selection bias is a likely problem in any attempt to "validate" employee-selection criteria. With minor modifications, the recently developed techniques for dealing with sample-selection problems can be used. Using data on applicants for first-line supervisory positions and ratings of on-the-job performance of those hired, ordinary least squares estimates of the determinants of performance are compared with maximum-likelihood estimates which correct for selection bias. The correction for selection bias produces changes in the expected direction in some variables' coefficients, though the corrected estimates remain insignificant at conventional levels.

The author is Associate Professor of Economics. University of Maryland. and is affiliated with the National Bureau of Economic Research.
* I have benefited from the suggestions of seminar participants at these universities: Harvard, Maryland, Chicago, Washington (St. Louis), and Columbia. I am grateful to Bronwyn Hall for help with the maximum likelihood estimation package MAXLIK, to Nancy Lemrow for research assistance, and to the General Research Board and the Computer Science Center at the University of Maryland for supporting me and the computations, respectively. The research reported here is part of the NBER's research program in Labor Studies. Any opinions expressed are those of the author and not those of the National Bureau of Economic Research.

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