Incentives: New Research on an Old Problem

The way incentives relate to public service performance is a major theoretical issue in public administration and one that is as important in times of austerity as in more expansionary times. What are the incentives and payoffs for the various players, from elected politicians through managers to those in the front line? Do incentives actually work in the direction expected by basic economics and if so how strongly do they work? Are there incentives other than money rewards that have a discernible effect on public service performance? Are there perverse incentives that contrive to punish virtue and reward mediocrity or failure? Such questions are not new. But this issue reports new findings about incentives in public services from a major research program on public services in the United Kingdom funded by the Economic and Social Research Council (ESRC). ESRC is a semi-independent national public body that has a mission to promote useful knowledge and that supports peer-reviewed public-domain research across the social sciences. Between 2004 and 2010, ESRC funded a program of some 47 linked research projects to explore aspects of public service performance, directed by Christopher Hood of the University of Oxford (see www.publicservices.ac.uk). The papers included in this issue are all taken from that research program, and the relationship between public service performance and incentives, rewards, liability, and blame was one of its central research themes.