Designing Wage Contracts in Multi-Goal Organizations
Economic theory has long suggested the use of monetary incentives to motivate workers. In practice, however, public bureaucracies and nonprofit organizations are driven by a broader mission that often involves multiple operational goals, not all of...
| Main Authors: | , , |
|---|---|
| Format: | Brief |
| Language: | English |
| Published: |
World Bank, Washington, DC
2018
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/114591516872389902/Designing-wage-contracts-in-multi-goal-organizations http://hdl.handle.net/10986/29294 |
| Summary: | Economic theory has long suggested the
use of monetary incentives to motivate workers. In practice,
however, public bureaucracies and nonprofit organizations
are driven by a broader mission that often involves multiple
operational goals, not all of which may translate equally
well into measurable indicators. The authors worked with the
largest partner of a prominent development organization in
Pakistan called the Pakistan Poverty Alleviation Fund (PPAF)
and its largest partner National Rural Support Program
(NRSP) who share the same mission of reducing poverty. The
study was conducted in all thirty five branch offices
located in fifteen districts across Sindh, Punjab, and
Khyber Pakhtunkhwa provinces, where NRSP was active. These
results indicate that both production and cost
complementarities are empirically relevant. Finally, the
results suggest that financial incentives that crowd out
intrinsic motivation can also affect performance by
undermining the willingness of motivated employees to work
in teams. |
|---|