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Incentives in the Public Sector: Evidence from a Government Agency

Simon M. Burgess, Carol Propper, Marisa Ratto () and Emma Tominey
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Simon M. Burgess: IZA - Institute for the study of labor - Institute for the Study of Labor - IZA
Emma Tominey: IZA - Institute for the study of labor - Institute for the Study of Labor - IZA

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Abstract: We study the impact of team-based performance pay in a major UK government agency, the public employment service. The scheme covered quantity and quality targets, measured with varying degrees of precision. We use unique data from the agency's performance management system and personnel records, linked to local labour market data. We show that on average the scheme had no significant effect but had a substantial positive effect in small teams, fitting an explanation combining free riding and peer monitoring. The impact was greater on better-measured quantity outcomes than quality outcomes. The scheme was very cost effective in small offices.

Keywords: personnel economics; teams; Incentives; public sector; performance (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eff, nep-hrm and nep-reg
Date: 2017
Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-01651132
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Published in The Economic Journal, 2017, 127 (Feature issue), ⟨10.1111/ecoj.12422⟩

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Related works:
Journal Article: Incentives in the Public Sector: Evidence from a Government Agency (2017) Downloads
Working Paper: Incentives in the Public Sector: Evidence from a Government Agency (2012) Downloads
Working Paper: Incentives in the Public Sector: Evidence from a Government Agency (2012) Downloads
Working Paper: Incentives in the Public Sector: Evidence from a Government Agency (2011) Downloads
Working Paper: Incentives in the Public Sector: Evidence from a Government Agency (2004) Downloads
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