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The Influence of Incentive Systems on Public Servant Performance: A Review of the International Literature

In: Proceedings of the 10th International Conference on Accounting, Management, and Economics (10th ICAME 2025)

Author

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  • Arthur Merold Sahusilawane

    (Hasanuddin University)

Abstract

The performance of public servants is an important issue in realizing effective, accountable, and responsive governance. One of the instruments that is often used to improve performance is the incentive system, both in the form of financial compensation and non-financial awards. However, the effectiveness of incentives in the public sector is still up for debate. International studies show that pay-for-performance can drive short-term productivity but is often unsustainable and potentially distorts behavior. In contrast, non-financial incentives such as recognition, career development, and work flexibility have been shown to more consistently increase employee intrinsic motivation and loyalty. This study uses a systematic literature review approach to various international studies, including from Pakistan, the United Arab Emirates, Saudi Arabia, and the United States. The results of the synthesis show the need for a combination of financial and non-financial incentives that are aligned with the value of public services, evaluation transparency, and ethical leadership. Policy implications emphasize the importance of adaptive and sustainable incentive design, while future research agendas need to explore developing country contexts, longitudinal studies, and integration with the sustainability (ESG) agenda.

Suggested Citation

  • Arthur Merold Sahusilawane, 2026. "The Influence of Incentive Systems on Public Servant Performance: A Review of the International Literature," Advances in Economics, Business and Management Research, in: Mursalim Nohong & Rianda Ridho Hafizh Thaha & Muhammad Try Dharsana & Andi Tenri Harahap & Fakhrul I (ed.), Proceedings of the 10th International Conference on Accounting, Management, and Economics (10th ICAME 2025), pages 1517-1535, Springer.
    • Handle: RePEc:spr:advbcp:978-94-6239-709-5_106
    DOI: 10.2991/978-94-6239-709-5_106
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