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Transparency, Recruitment and Retention in the Public Sector

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  • Clare Leaver
  • Gian Luigi Albano
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    Abstract

    This paper argues that government should pay greater heed to recruitment and retention when designing performance measurement systems for bureaucracies. In the face of pervasive rigidities in public sector pay, internal performance measurement rewards quitters and scars stayers and therefore makes it difficult to recruit and retain. Full and immediate publication of performance minimizes the cost of initial recruitment but entails retaining and paying rents to poor performers. This is optimal only if skill differences are low and the value of public production is moderate: high enough to warrant recruitment but not so high that good performers are retained. Human capital objectives are typically better met by abstaining from performance measurement altogether or `stage-managing` its publication, suggesting that the current emphasis on incentives and accountability may be misplaced.

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    File URL: http://www.economics.ox.ac.uk/materials/working_papers/paper219.pdf
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    Bibliographic Info

    Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 219.

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    Date of creation: 01 Dec 2004
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    Handle: RePEc:oxf:wpaper:219

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    Related research

    Keywords: Performance Measurement; Disclosure; Information Management; Sorting; Wage Compression; Public Sector;

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    References

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    2. Courty, Pascal & Marschke, Gerald, 1997. "Measuring Government Performance: Lessons from a Federal Job-Training Program," American Economic Review, American Economic Association, vol. 87(2), pages 383-88, May.
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    4. George J. Borjas, 2002. "The Wage Structure and the Sorting of Workers into the Public Sector," NBER Working Papers 9313, National Bureau of Economic Research, Inc.
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    10. repec:rus:hseeco:122160 is not listed on IDEAS
    11. Deborah Wilson & Bronwyn Croxson & Adele Atkinson, 2004. "“What Gets Measured Gets Done”: Headteachers’ Responses to the English Secondary School," The Centre for Market and Public Organisation 04/107, Department of Economics, University of Bristol, UK.
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    18. Caroline M. Hoxby & Andrew Leigh, 2004. "Pulled Away or Pushed Out? Explaining the Decline of Teacher Aptitude in the United States," American Economic Review, American Economic Association, vol. 94(2), pages 236-240, May.
    19. McLaughlin, Kenneth J, 1990. "General Productivity Growth in a Theory of Quits and Layoffs," Journal of Labor Economics, University of Chicago Press, vol. 8(1), pages 75-98, January.
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    Cited by:
    1. Gian Luigi Albano & Clare Leaver, 2005. "Transparency, Recuitment and Retention in the Public Sector," The Centre for Market and Public Organisation 05/132, Department of Economics, University of Bristol, UK.
    2. Alexander K. Koch & Eloïc Peyrache, 2011. "Aligning Ambition and Incentives," Journal of Law, Economics and Organization, Oxford University Press, vol. 27(3), pages 655-688.

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