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Competition and incentives with motivated agents

Timothy Besley () and Maitreesh Ghatak ()

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: A unifying theme in the literature on organizations such as public bureaucracies and private non-profits is the importance of missions, as opposed to profit, as an organizational goal. Such mission-oriented organizations are frequently staffed by motivated agents who subscribe to the mission. This paper studies incentives in such contexts and emphazises the role of matching principals' and agents' mission preferences in increasing organizational efficiency. Matching economizes on the need for high-powered incentives. However, it can also entrench bureaucratic conservatism and resistance to innovations. The framework developed in this paper is applied to school competition, incentives in the public sector and in private nonprofits, and the interdependence of incentives and productivity between the private for-profit sector and the mission-oriented sector through occupational choice.

Keywords: Motivated agents; incentives in the public sector; school competition (search for similar items in EconPapers)
JEL-codes: L31 L22 H41 D23 J41 D21 L33 (search for similar items in EconPapers)
Date: 2003-11
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Downloads: (external link)
http://eprints.lse.ac.uk/2202/ Open access version. (application/pdf)

Related works:
Journal Article: Competition and Incentives with Motivated Agents (2005) Downloads
Working Paper: Competition and incentives with motivated agents (2005) Downloads
Working Paper: Competition and Incentives with Motivated Agents (2004) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:2202

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