The Allocation of Incentives in Multi-Layered Organizations: Evidence from a Community Health Program in Sierra Leone

Stefano Caria, Philipp Kastrau, Erika Deserranno and Gianmarco León-Ciliotta
Authors registered in the RePEc Author Service: Gianmarco León-Ciliotta ()

No 1346, Working Papers from Barcelona School of Economics

Abstract: Does the allocation of incentives across the hierarchy of an organization matter for its performance? In a ï¬ eld experiment with a large public-health organization in Sierra Leone, we ï¬ nd that healthcare provision is highly affected by how incentives are allocated between frontline workers and their supervisors. Sharing incentives equally between these two layers raises completed health visits by 61% compared to the unilateral allocations that are typical in public-health organizations. Also, the shared incentives uniquely improve overall health service provision and health outcomes. We provide reduced form and structural evidence that these results are driven by a combination of effort complementarities and contractual frictions, and we explore the implications of these forces for the optimal design of incentive policies in multi-layered organizations.

Keywords: incentives; output; multi-layered organizations; effort complementarities; side payments; hierarchies (search for similar items in EconPapers)
JEL-codes: I15 J31 M52 O15 O55 (search for similar items in EconPapers)
Date: 2022-05
New Economics Papers: this item is included in nep-exp, nep-hea and nep-hrm
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Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:1346

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