Mission and the Bottom Line: Performance Incentives in a Multigoal Organization

Xavier Gine, Ghazala Mansuri and Slesh A. Shrestha

The Review of Economics and Statistics, 2022, vol. 104, issue 4, 748-763

Abstract: We assess the role of monetary incentives in a mission-oriented organization by randomly assigning workers to one of two bonus schemes, incentivizing either the performance of a microcredit program (bottom line) or the empowerment of clients (mission). We find that the credit bonus improved credit-related outcomes but undermined the social mission, while the social bonus did not harm the bottom line. These results are consistent with a multitasking model with production spillovers or with prosocial behavior. We show that when mission-related rewards are not feasible, organizations that care about both the mission and the bottom line prefer flat wages to incentives.

Date: 2022
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