Motivations, Monitoring Technologies, and Pay for Performance

Monitoring technologies and pay for performance (PFP) contracts are becoming popular solutions to improve public services delivery. Their track record is however mixed. To show why this may be the case, this paper develops a principal agent model where agents’ motivations vary and so the effectivene...

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Bibliographic Details
Main Authors:	Cordella, Antonio, Cordella, Tito
Format:	Journal Article
Published:	Elsevier 2018
Subjects:	PAY FOR PERFORMANCE PUBLIC SECTOR MANAGEMENT INFORMATION AND COMMUNICATION TECHNOLOGY ASYMMETRIC INFORMATION MOTIVATIONS OPTIMAL CONTRACTS
Online Access:	http://hdl.handle.net/10986/29339

id	okr-10986-29339
recordtype	oai_dc
spelling	okr-10986-293392021-05-25T10:54:44Z Motivations, Monitoring Technologies, and Pay for Performance Cordella, Antonio Cordella, Tito PAY FOR PERFORMANCE PUBLIC SECTOR MANAGEMENT INFORMATION AND COMMUNICATION TECHNOLOGY ASYMMETRIC INFORMATION MOTIVATIONS OPTIMAL CONTRACTS Monitoring technologies and pay for performance (PFP) contracts are becoming popular solutions to improve public services delivery. Their track record is however mixed. To show why this may be the case, this paper develops a principal agent model where agents’ motivations vary and so the effectiveness of monitoring technologies. In such a set-up, it shows that: (i) monitoring technologies should be introduced only if agents’ motivations are poor; (ii) optimal PFP contracts are non-linear/non-monotonic in agents’ motivations and monitoring effectiveness; (iii) investments aimed at improving agents’ motivations and monitoring quality are substitutes when agents are motivated, complements otherwise; (iv) if the agents’ “type” is private information, the more and less motivated agents could be separated through a menu of PFP/non-PFP contracts, designed in a way that only the less motivated ones choose the PFP. 2018-02-08T17:06:37Z 2018-02-08T17:06:37Z 2017-01 Journal Article Journal of Economic Behavior and Organization 0167-2681 http://hdl.handle.net/10986/29339 CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Elsevier Publications & Research :: Journal Article Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
topic	PAY FOR PERFORMANCE PUBLIC SECTOR MANAGEMENT INFORMATION AND COMMUNICATION TECHNOLOGY ASYMMETRIC INFORMATION MOTIVATIONS OPTIMAL CONTRACTS
spellingShingle	PAY FOR PERFORMANCE PUBLIC SECTOR MANAGEMENT INFORMATION AND COMMUNICATION TECHNOLOGY ASYMMETRIC INFORMATION MOTIVATIONS OPTIMAL CONTRACTS Cordella, Antonio Cordella, Tito Motivations, Monitoring Technologies, and Pay for Performance
description	Monitoring technologies and pay for performance (PFP) contracts are becoming popular solutions to improve public services delivery. Their track record is however mixed. To show why this may be the case, this paper develops a principal agent model where agents’ motivations vary and so the effectiveness of monitoring technologies. In such a set-up, it shows that: (i) monitoring technologies should be introduced only if agents’ motivations are poor; (ii) optimal PFP contracts are non-linear/non-monotonic in agents’ motivations and monitoring effectiveness; (iii) investments aimed at improving agents’ motivations and monitoring quality are substitutes when agents are motivated, complements otherwise; (iv) if the agents’ “type” is private information, the more and less motivated agents could be separated through a menu of PFP/non-PFP contracts, designed in a way that only the less motivated ones choose the PFP.
format	Journal Article
author	Cordella, Antonio Cordella, Tito
author_facet	Cordella, Antonio Cordella, Tito
author_sort	Cordella, Antonio
title	Motivations, Monitoring Technologies, and Pay for Performance
title_short	Motivations, Monitoring Technologies, and Pay for Performance
title_full	Motivations, Monitoring Technologies, and Pay for Performance
title_fullStr	Motivations, Monitoring Technologies, and Pay for Performance
title_full_unstemmed	Motivations, Monitoring Technologies, and Pay for Performance
title_sort	motivations, monitoring technologies, and pay for performance
publisher	Elsevier
publishDate	2018
url	http://hdl.handle.net/10986/29339
_version_	1764469101057540096

Motivations, Monitoring Technologies, and Pay for Performance

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