False or fitting recognition? The use of high performance bonuses in motivating organizational achievements
This research undertakes a theoretical and empirical examination of (high performance bonus) systems in government, that is, incentive payments awarded by the federal government to state organizations or statewide programs to motivate and recognize high performance achievements. The paper draws from a multidisciplinary literature on incentives in organizations to first derive implications for the design and implementation of high performance bonus systems. An empirical analysis of the Workforce Investment Act performance bonus system and its effectiveness in recognizing and rewarding performance follows. The results of the theoretical and empirical investigation suggest that high performance bonus systems are more likely to encourage misrepresentation of performance and other strategic behaviors than to recognize and motivate exceptional performance or performance improvements. © 2007 by the Association for Public Policy Analysis and Management
Volume (Year): 26 (2007)
Issue (Month): 2 ()
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References listed on IDEAS
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- James J. Heckman & Carolyn Heinrich & Jeffrey Smith, 2002.
"The Performance of Performance Standards,"
Journal of Human Resources,
University of Wisconsin Press, vol. 37(4), pages 778-811.
- Heckman, James J. & Heinrich, Carolyn J. & Smith, Jeffrey A., 2002. "The Performance of Performance Standards," IZA Discussion Papers 525, Institute for the Study of Labor (IZA).
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- Robert Gibbons, 1998. "Incentives in Organizations," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 115-132, Fall.
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- Gerald Marschke & Pascal Courty, 2000. "An Empirical Investigation of Gaming Responses to Performance Incentives," Discussion Papers 00-12, University at Albany, SUNY, Department of Economics.
- Baker, George P, 1992. "Incentive Contracts and Performance Measurement," Journal of Political Economy, University of Chicago Press, vol. 100(3), pages 598-614, June. Full references (including those not matched with items on IDEAS)
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