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Dynamic reform of public institutions: a model of motivated agents and collective reputation
[working paper]
Corporate Editor
Wissenschaftszentrum Berlin für Sozialforschung gGmbH
Abstract State capacity is optimized when public institutions are staffed by individuals
with public-service motivation. However, when motivated agents value the collective
reputation of their place of employment, steady-state equilibria with both
high and low aggregate motivation (reputation) in the miss... view more
State capacity is optimized when public institutions are staffed by individuals
with public-service motivation. However, when motivated agents value the collective
reputation of their place of employment, steady-state equilibria with both
high and low aggregate motivation (reputation) in the mission-oriented sector
exist. Reforming a low-motivation institution requires a non-monotonic wage
path: since the effect of higher wages on motivation is negative for a highreputation
institution, but positive for a low-reputation institution, a transition to
a high-reputation steady state requires an initial wage increase to crowd motivated
workers in, followed by a wage decrease to crowd non-motivated workers out.... view less
Keywords
public service; efficiency; wage; public sector; motivation; wage increase; reputation; corruption; incentive
Classification
Income Policy, Property Policy, Wage Policy
Applied Psychology
Document language
English
Publication Year
2016
Edition
rev. version
City
Berlin
Page/Pages
40 p.
Series
Discussion Papers / Wissenschaftszentrum Berlin für Sozialforschung, Forschungsschwerpunkt Markt und Entscheidung, Abteilung Ökonomik des Wandels, SP II 2015-303r
Status
Published Version; reviewed
Licence
Deposit Licence - No Redistribution, No Modifications