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Making Moves Matter: Experimental Evidence on Incentivizing Bureaucrats through Performance-Based Postings

Author

Listed:
  • Adnan Q. Khan
  • Asim Ijaz Khwaja
  • Benjamin A. Olken

Abstract

Bureaucracies often post staff to better or worse locations, ostensibly to provide incentives. Yet we know little about whether this works, with heterogeneity in preferences over postings impacting effectiveness. We propose a performance-ranked serial dictatorship mechanism, whereby bureaucrats sequentially choose desired locations in order of performance. We evaluate this using a two-year field experiment with 525 property tax inspectors in Pakistan. The mechanism increases annual tax revenue growth by 30-41 percent. Inspectors that our model predicts face high equilibrium incentives under the scheme indeed increase performance more. Our results highlight the potential of periodic merit-based postings in enhancing bureaucratic performance.

Suggested Citation

  • Adnan Q. Khan & Asim Ijaz Khwaja & Benjamin A. Olken, 2018. "Making Moves Matter: Experimental Evidence on Incentivizing Bureaucrats through Performance-Based Postings," NBER Working Papers 24383, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:24383
    Note: DEV PE POL
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    References listed on IDEAS

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    1. Raj Chetty, 2009. "Is the Taxable Income Elasticity Sufficient to Calculate Deadweight Loss? The Implications of Evasion and Avoidance," American Economic Journal: Economic Policy, American Economic Association, vol. 1(2), pages 31-52, August.
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    More about this item

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption

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