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Performance-Related Payment in the Public Sector: Theoretical Issues and Results from a Case Study of a Brazilian Government Agency

Author

Listed:
  • Paulo Augusto Pettenuzzo Britto

    (University of Brasília
    Prédio da FACE)

  • Carlos Henrique Rocha

    (Universidade de Brasília
    Prédio da FACE)

  • Andrea Oliveira Gonçalves

    (University of Brasília
    Prédio da FACE)

Abstract

Performance-related pay (PRP) is a tool used to induce productivity gains by aligning workers and enterprises incentives. In the public sector it involves, in addition to motivation, attracting and maintaining qualified personnel, reducing costs and promoting public objectives. Several countries have adopted PRP in the public sector. PRP in the public sector differ from those seen in private sector because in most of the public sector organizations there is no obvious way to measure productivity. This article contributes to the PRP discussion by presenting a theoretical model, discussing recent experiences, and simulating an application to a case study to a Brazilian government agency showing that a productivity gain of 3% would be sufficient to cover the cost of the gratifications leaving a positive net result to the Treasury.

Suggested Citation

  • Paulo Augusto Pettenuzzo Britto & Carlos Henrique Rocha & Andrea Oliveira Gonçalves, 2023. "Performance-Related Payment in the Public Sector: Theoretical Issues and Results from a Case Study of a Brazilian Government Agency," Public Organization Review, Springer, vol. 23(3), pages 1275-1292, September.
    • Handle: RePEc:kap:porgrv:v:23:y:2023:i:3:d:10.1007_s11115-022-00660-7
    DOI: 10.1007/s11115-022-00660-7
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    References listed on IDEAS

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