Arbeitspapier

Dynamic reform of public institutions: A model of motivated agents and collective reputation

State capacity is optimized when public institutions are staffed by individuals with public-service motivation. However, when motivated agents value the collective reputation of their place of employment, steady-state equilibria with both high and low aggregate motivation (reputation) in the mission-oriented sector exist. Reforming a low-motivation institution requires a non-monotonic wage path: since the effect of higher wages on motivation is negative for a highreputation institution, but positive for a low-reputation institution, a transition to a high-reputation steady state requires an initial wage increase to crowd motivated workers in, followed by a wage decrease to crowd non-motivated workers out.

Language
Englisch

Bibliographic citation
Series: WZB Discussion Paper ; No. SP II 2015-303r

Classification
Wirtschaft
Organizational Behavior; Transaction Costs; Property Rights
Bureaucracy; Administrative Processes in Public Organizations; Corruption
Public Enterprises; Public-Private Enterprises
Subject
Motivated Agents
Institutional Reform
Public Sector

Event
Geistige Schöpfung
(who)
Valasek, Justin
Event
Veröffentlichung
(who)
Wissenschaftszentrum Berlin für Sozialforschung (WZB)
(where)
Berlin
(when)
2016

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Valasek, Justin
  • Wissenschaftszentrum Berlin für Sozialforschung (WZB)

Time of origin

  • 2016

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