This paper addresses a lack of evidence on the impact of performance pay in the public sector by evaluating a pilot … targets, measured with varying degrees of precision. We use data from the agency’s performance management system and personnel … records plus matched labour market data. We focus on three main issues: whether performance pay matters for public service …

performance, even with quite large teams. We examine whether this effect was due to increased effort from workers or strategic … task reallocation. We find that the provision of financial incentives did raise individual performance but that managers …