Leadership

Crowding Out Intrinsic Motivation? The Role Of Performance-Related Pay

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Executive Summary

This paper attempts to expand upon the current debate involving the relationship between performance-related pay and public service motivation. Two models are used to examine how variable pay influences public service motivation and job satisfaction among a sample of city managers, assistant city managers, and department heads. Findings support the argument that variable pay systems can crowd out public service motivation. However, results also present a much more complicated picture. Variable pay systems appear to primarily crowd out the intrinsic motives of those with high levels of public service motivation.

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