Performance Pay and Judicial Production: Evidence from Spain

Abstract: This paper analyzes the impact of the introduction of a performance pay scheme rewarding Spanish judges. The Spanish top judicial authority established modules of production for every task judges undertake and then calculated production benchmarks. Since 2004, judges were awarded a 5% bonus if production exceeded the benchmark by 20%. We find that the introduction of this scheme increased the number of judges exceeding this threshold, and also increased average production. Nevertheless, we also observe that, consistent with a potential deterioration of intrinsic motivation, top performing judges significantly reduced their production.