IDEAS home Printed from https://ideas.repec.org/p/eth/wpswif/18-307.html

Incentive Pay for Policy-makers?

Author

Listed:
  • Volker Britz

    (ETH Zurich, Switzerland)

  • Afsoon Ebrahimi

    (ETH Zurich, Switzerland)

  • Hans Gersbach

    (ETH Zurich, Switzerland)

Abstract

We study how to efficiently motivate policy-makers to solve political multitask problems. Political multi-task problems typically have outcomes that are difficult to measure. Moreover, there are conflicts among citizens about optimal policies and the agents have the power to tax the citizens to invest in better outcomes of some tasks. We develop a political agency model with two tasks and only one measurable outcome. In such an environment, policy-makers choose socially inefficient public good levels and expropriate minorities. A judicious combination of constitutional limits on taxation and incentive pay for policy-makers is second-best. Incentive pay is conditional on the public good level.

Suggested Citation

  • Volker Britz & Afsoon Ebrahimi & Hans Gersbach, 2018. "Incentive Pay for Policy-makers?," CER-ETH Economics working paper series 18/307, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    • Handle: RePEc:eth:wpswif:18-307
    as

    Download full text from publisher

    File URL: https://www.ethz.ch/content/dam/ethz/special-interest/mtec/cer-eth/cer-eth-dam/documents/working-papers/WP-18-307.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. is not listed on IDEAS
    2. Carlos Seixas & Diogo Lourenço, 2024. "On the optimality of policy choices in the face of biased beliefs, retrospective voting and the down-up problem," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 63(2), pages 299-321, September.

    More about this item

    Keywords

    ;
    ;
    ;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eth:wpswif:18-307. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/iwethch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.