Can Bureaucrats Really Be Paid Like CEOs? School Administrator Incentives for Anemia Reduction in Rural China / Renfu Luo, Grant Miller, Scott Rozelle, Sean Sylvia, Marcos Vera-Hernández.

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Luo, Renfu

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TextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w21302.Publication details: Cambridge, Mass. National Bureau of Economic Research 2015.Description: 1 online resource: illustrations (black and white)Subject(s):

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Abstract: Unlike performance incentives for private sector managers, little is known about performance incentives for managers in public sector bureaucracies. Through a randomized trial in rural China, we study performance incentives rewarding school administrators for reducing student anemia--as well as complementarity between incentives and orthogonally assigned discretionary resources. Large (but not small) incentives and unrestricted grants both reduced anemia, but incentives were more cost-effective. Although unrestricted grants and small incentives do not interact, grants fully crowd-out the effect of larger incentives. Our findings suggest that performance incentives can be effective in bureaucratic environments, but they are not complementary to discretionary resources.

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Previous	nber w2130 Fiscal Deficits, Exchange Rate Crises and Inflation /	nber w21300 The Effects of Earnings Disclosure on College Enrollment Decisions /	nber w21301 Self-Protection Investment Exacerbates Air Pollution Exposure Inequality in Urban China /	nber w21302 Can Bureaucrats Really Be Paid Like CEOs? School Administrator Incentives for Anemia Reduction in Rural China /	nber w21303 Is the WTO passé? /	nber w21304 Beyond Statistics: The Economic Content of Risk Scores /	nber w21305 Risk and Risk Management in the Credit Card Industry /	Next

June 2015.

Unlike performance incentives for private sector managers, little is known about performance incentives for managers in public sector bureaucracies. Through a randomized trial in rural China, we study performance incentives rewarding school administrators for reducing student anemia--as well as complementarity between incentives and orthogonally assigned discretionary resources. Large (but not small) incentives and unrestricted grants both reduced anemia, but incentives were more cost-effective. Although unrestricted grants and small incentives do not interact, grants fully crowd-out the effect of larger incentives. Our findings suggest that performance incentives can be effective in bureaucratic environments, but they are not complementary to discretionary resources.