The Paradox of Performance Related Pay Systems: 'Why Do We Keep Adopting Them in the Face of Evidence that they Fail to Motivate?'
This paper considers one of the paradoxes of incentive pay used in Britain's public services, namely that despite much evidence that it does not motivate employees, it continues to be widely used. It is argued that behind this evidence, there are significant examples in which its use has been associated with improved performance. A good part of this is to be explained by the way performance pay links pay and appraisal, and the pressure this puts on line managers to set clearer goals for their staff. There is also some evidence that the goal setting is the outcome of a form of integrative, or positive sum, negotiation between individual employees and their managers, and that it is not just 'top down'.
|Date of creation:||Aug 2009|
|Date of revision:|
|Contact details of provider:|| Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Tirole, Jean, 1994.
"The Internal Organization of Government,"
Oxford Economic Papers,
Oxford University Press, vol. 46(1), pages 1-29, January.
- Adele Atkinson & Simon Burgess & Bronwyn Croxson & Paul Gregg, 2004.
"Evaluating the Impact of Performance-related Pay for Teachers in England,"
The Centre for Market and Public Organisation
04/113, Department of Economics, University of Bristol, UK.
- Atkinson, Adele & Burgess, Simon & Croxson, Bronwyn & Gregg, Paul & Propper, Carol & Slater, Helen & Wilson, Deborah, 2009. "Evaluating the impact of performance-related pay for teachers in England," Labour Economics, Elsevier, vol. 16(3), pages 251-261, June.
- David Marsden & Richard Belfield, 2006.
"Pay for performance where output is hard to measure: the case of performance pay for school teachers,"
LSE Research Online Documents on Economics
4675, London School of Economics and Political Science, LSE Library.
- Richard Belfield & David Marsden, 2006. "Pay for Performance Where Output is Hard to Measure: the Case of Performance Pay for School Teachers," CEP Discussion Papers dp0747, Centre for Economic Performance, LSE.
When requesting a correction, please mention this item's handle: RePEc:cep:cepdps:dp0946. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.