Crowding Out Intrinsic Motivation in the Public Sector

Abstract

Employing intrinsically motivated individuals has been proposed as a means of improving public sector performance. In this article, we investigate whether intrinsic motivation affects the sorting of employees between the private and the public sectors, paying particular attention to whether extrinsic rewards crowd out intrinsic motivation. Using British longitudinal data, we find that individuals are attracted to the public sector by the intrinsic rather than the extrinsic rewards that the sector offers. We also find evidence supporting the intrinsic motivation crowding out hypothesis, in that, higher extrinsic rewards reduce the propensity of intrinsically motivated individuals to accept public sector employment. This is, however, only true for two segments of the UK public sector: the higher education sector and the National Health Service. Although our findings inform the literature on public service motivation, they also pose the question whether lower extrinsic rewards could increase the average quality of job matches in the public sector, thus improving performance without the need for high-powered incentives.

Where Does the Good Shepherd Go? Civic Virtue and Sorting into Public Sector Employment

“…Prosocial motivation and its relationship with employment in the public sector have been analyzed in various contexts (e.g., Zoutenbier, 2014, 2015;Georgellis et al, 2011), as well as the relationship between need for security and public sector employment (e.g., Bellante and Link, 1981;Pfeifer, 2011;Roszkowski and Grable, 2009). …”

“…First, do other forms of prosocial motivation also relate positively to public sector employment, or only altruism, a specific form of prosocial motivation? Prosocial motivation can have different forms: the motive to be there for those in the closer environment (altruism) and the motive to contribute to 1 Some articles in this research area study intrinsic motivation (Crewson 1997;Frank and Lewis 2004;Georgellis et al 2011;Houston 2000;Serra et al 2011) and interpret the findings in the context of public service motivation, a construct that is related to prosocial motivation (Perry 1996;Perry and Wise 1990;Perry et al 2010).…”

The Path Extended from Organizational Culture to Innovative Work Behavior: A Research on a Defense Company

“…The public organizations innovate in a political environment where competitive advantages or performance enhancements are not permitted by pure market pursuit of objectives (Oliver and Holzinger, 2008). Goals are defined through political processes, often resulting in being misaligned with individual work performance (Georgellis et al, 2011). In regards to private organizations, in contrast, they aim to innovate in dynamic environments where the competitive advantage is retained and developed only through continuous adaptation to external changes (Fauchart and Keilbach, 2009;Ren and Guo, 2011).…”

Behavioral political economy: A survey

“…Some empirical evidence suggests that intrinsically motivated individuals select themselves into jobs in the public sector, which are often paid less than comparable positions in the private sector (Georgellis et al 2011). Charness et al (2013 offer experimental evidence suggesting that if individuals in an organization receive information on relative performance, but are paid flat wages, they will invest in destructive effort and sabotage their internal competitors' work.…”