Working Paper: CEPR ID: DP15837
Authors: Erika Deserranno; Gianmarco Len Ciliotta
Abstract: We study promotion incentives in the public sector by means of a field experiment with the Ministry of Health in Sierra Leone. The experiment creates exogenous variation in meritocracy by linking promotions to performance and variation in perceived pay progression among the lowest tier of health workers. We find that meritocratic promotions lead to higher productivity, and more so when workers expect a steep pay increase. However, when promotions are not meritocratic, increasing the pay gradient reduces productivity through negative morale effects. The findings highlight the importance of taking into account the interactions between different tools of personnel policy.
Keywords: promotions; meritocracy; pay progression; worker productivity
JEL Codes: M51; M52; J31; D73
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Meritocratic promotions (linked to performance) (J62) | productivity (O49) |
| Non-meritocratic promotions with increased pay gradients (J62) | productivity (O49) |
| Pay progression (in non-meritocratic settings) (J62) | morale issues (A13) |
| morale issues (A13) | productivity (O49) |
| Meritocratic promotions (J62) | productivity (stronger for high-performing workers) (D29) |