Organizational Mission, Financial Rewards and Performance of Bureaucrats
Abstract: Motivating bureaucrats to exert effort on their job is a central problem for many public sector organizations. In partnership with the health department in Pakistan, we study if bureaucracies can use the organizational mission to incentivize workers and compare the effectiveness of this strategy with a performance-based bonus scheme. We record four main results that shed light on how the public sector should design personnel policies. First, communicating the organizational mission is a viable strategy to motivate workers. Those who receive the mission treatment are five percentage points more likely to perform their duties and those that receive a performance-based bonus improve by nearly 10 percentage points, compared to control. The improvement in performance on extensive margin also leads to better health outcomes for children. Second, mission improves performance along multiple dimensions including teamwork and multiple tasks while bonus only improves it along the dimension linked directly to rewards. Third, providing a bonus in the presence of a mission lowers the effectiveness of bonus. Workers in this group serve 11 extra households, as opposed to 16 extra households in just the bonus group. Finally, the main channel for the mission to motivate workers is through their beliefs about the importance of mission for their work, and workplace norms do not appear to be strong drivers of behavior.
