Paying for what kind of performance? Performance pay, multitasking, and sorting in mission-oriented jobs
Paying for what kind of performance? Performance pay, multitasking, and sorting in mission-oriented jobs
How does pay-for-performance (P4P) impact productivity and the composition of workers in mission-oriented jobs when output has multiple dimensions? This is a central issue in the public sector, particularly in areas such as education and health care. We conduct an experiment, manipulating compensation and prosocial elements of the job, to answer these questions. We find that P4P has significantly smaller positive effects on productivity on the incentivized dimension in the prosocial setting relative to the non-prosocial setting. On the other hand, P4P generates no loss in performance on the non-incentivized dimension of effort in the prosocial setting, whereas it does so in the non-prosocial setting. In both settings, P4P attracts higher ability workers, but it does so at the expense of attracting prosocially-motivated workers in the prosocial setting.
Multitasking, Performance pay, Prosocial motivation, Sorting
480-507
Jones, Daniel B.
a362baa4-3028-45ab-b12e-4726489fa5b7
Tonin, Mirco
fcd223b6-577c-4116-a041-b30f29df42d1
Vlassopoulos, Michael
2d557227-958c-4855-92a8-b74b398f95c7
Winichakul, K. Pun
a0bc90be-a7f2-4146-a097-d02814281b19
22 September 2023
Jones, Daniel B.
a362baa4-3028-45ab-b12e-4726489fa5b7
Tonin, Mirco
fcd223b6-577c-4116-a041-b30f29df42d1
Vlassopoulos, Michael
2d557227-958c-4855-92a8-b74b398f95c7
Winichakul, K. Pun
a0bc90be-a7f2-4146-a097-d02814281b19
Jones, Daniel B., Tonin, Mirco, Vlassopoulos, Michael and Winichakul, K. Pun
(2023)
Paying for what kind of performance? Performance pay, multitasking, and sorting in mission-oriented jobs.
Games and Economic Behavior, 142, .
(doi:10.1016/j.geb.2023.08.002).
Abstract
How does pay-for-performance (P4P) impact productivity and the composition of workers in mission-oriented jobs when output has multiple dimensions? This is a central issue in the public sector, particularly in areas such as education and health care. We conduct an experiment, manipulating compensation and prosocial elements of the job, to answer these questions. We find that P4P has significantly smaller positive effects on productivity on the incentivized dimension in the prosocial setting relative to the non-prosocial setting. On the other hand, P4P generates no loss in performance on the non-incentivized dimension of effort in the prosocial setting, whereas it does so in the non-prosocial setting. In both settings, P4P attracts higher ability workers, but it does so at the expense of attracting prosocially-motivated workers in the prosocial setting.
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Accepted/In Press date: 10 July 2023
e-pub ahead of print date: 29 August 2023
Published date: 22 September 2023
Additional Information:
Funding Information:
We thank Robert Dur, Josse Delfgaauw, Michael Gibbs, Sera Linardi, Stephan Meier and seminar and workshop participants at Birmingham, Bocconi, Erasmus, Innsbruck, Cambridge Judge Business School, the Science of Philanthropy Initiative 2017 conference, and the IZA World Labor Conference 2018 for helpful comments. Financial support from the Riegel and Emory Human Resources Center at the University of South Carolina is gratefully acknowledged. We thank Matthew Harvey and Xiaocheng Hu for excellent research assistance.
Publisher Copyright:
© 2023 Elsevier Inc.
Keywords:
Multitasking, Performance pay, Prosocial motivation, Sorting
Identifiers
Local EPrints ID: 481542
URI: http://eprints.soton.ac.uk/id/eprint/481542
ISSN: 0899-8256
PURE UUID: 6844c4f7-4b00-4b9b-bcc5-1c3076ccff95
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Date deposited: 31 Aug 2023 17:02
Last modified: 18 Mar 2024 03:07
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Contributors
Author:
Daniel B. Jones
Author:
Mirco Tonin
Author:
K. Pun Winichakul
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