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. 2020 Sep:146:102295.
doi: 10.1016/j.jdeveco.2018.10.003.

Performance bonuses in the public sector: Winner-take-all prizes versus proportional payments to reduce child malnutrition in India

Prakarsh Singh  1 , William A Masters  2
Affiliations

Performance bonuses in the public sector: Winner-take-all prizes versus proportional payments to reduce child malnutrition in India

Prakarsh Singh et al. J Dev Econ. 2020 Sep.

Abstract

We conduct a randomized trial to compare incentives for improved child outcomes among salaried caregivers in Chandigarh, India. A contest whose prize is divided among workers in proportion to measured gains yielded more improvement than a winner-take-all program. In our population of about 2000 children served by 85 workers, using proportional rewards led to weight-for-age malnutrition rates that were 4.3 percentage points lower at 3 months (when rewards were paid) and 5.9 points lower at 6 months (after the contest had ended), with mean weight-for-age z scores that were 0.071 higher at 3 months, and 0.095 higher at 6 months. Proportional bonuses led to larger and more sustained gains because of better performance by lower-ranked workers, whose efforts were not rewarded by a winner-take-all prize. Results are consistent with previous laboratory trials and athletic events, demonstrating the value of proportional rewards to improve development outcomes.

Keywords: Child development; Contest design; Malnutrition; Performance pay; Underweight.

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Figures

Fig. 1
Fig. 1
Map of Anganwadi centers in Chandigarh, by treatment.
Fig. 2
Fig. 2
Payout to worker at Endline-1 in Rupees (x axis) and weight for age z score (y axis) at Endline-2, by treatment arm.
Fig. 3
Fig. 3
Weight-for-age z scores by type of incentive, before and after treatment.
See this image and copyright information in PMC

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