A good example of detailed pay PRP and high-powered performance pay incentives comes from the federal Brazilian tax collection agency. In 1988 the Brazilian government created a bonus program for tax officials that rewarded the identification of tax violations. Base salary was augmented on a monthly basis on an individual and group basis. The group reward was calculated based on the relative performance of one local agency versus others, with relative performance measured based on total fines collected, attainment of pre-defined quotas (total tax collection, number of inspections, collection of overdue taxes) and the size of the agency. Individual rewards were based on monthly evaluations by the direct supervisor, which combined objective performance criteria and managerial discretion and rated employees on a scale from zero to 70. Each employee that scored more than 21 points was entitled to an individual reward with the value being determined by the overall availability of funds (which are proportional to the collected fines) and the performance of co-workers. It was not unusual for total bonus payments to reach 200% of base pay.

(Kahn, De Silva, et al. 2001) found that this incentive scheme resulted in a 75% increase in fines per inspection. At the same time, they also found substantial regional variation, with responses ranging from 19% to 145%. The authors do caution that diverse management techniques resulted in some regions targeting wealthier sources (such as corporations), more aggressively, which points to the potential negative effects of such high powered incentive schemes which may encourage extortion. Unfortunately, limited data prevented the authors from examining these social costs further.

Another study of revenue authorities is by (Bertelli 2006), which explores the potential tradeoff between intrinsic and extrinsic motivation in the Internal Revenue Service in the US. The IRS implemented a paybanding system that imposed high-powered performance incentives on supervisors, but not on nonsupervisory personnel. Using data from the 2002 Federal Human Capital Survey, the author showed that the incentive scheme crowded in intrinsic motivation at the lowest pay levels, and crowded out at the highest levels.

(World Bank 2001) used survey data from revenue departments in 14 low, middle and high income countries, and detailed case study evidence from 7 of those, to review the effectiveness of bonus and salary supplement systems as a means to enhance effectiveness in revenue departments. They concluded that the ―circumstantial evidence‖ suggests that bonus systems do indeed seem to have an impact on organizational effectiveness. They note that in a number of countries the introduction of bonus systems have had a measurable impact on recruitment and retention of employees. However, they note that the success of bonus systems relies heavily on ―legitimacy‖, i.e. the internal and external ―acceptance‖ of the bonus system.

A set of studies of performance incentives in a similar organizational context is that of the US Job Training Partnership Act (JTPA). Under the Act, 620 semi-autonomous training centers were responsible for implementing job training programs for the indigent, and were given financial incentives tied to labor market outcomes — employment status, earnings — of the trainees. These bonuses were given to the training centers thereby augmenting their budgets but could not be used to supplement staff salaries. (Courty and Marschke 2004) find evidence of the prevalence of gaming among the agency staff in the choice of termination date of the training for the participants, which while increasing organizational bonuses imposed a cost to the participants in terms of earnings. Similar effects have been found by related studies of the program (Heckman, Heinrich, et al. 1997).

An early quantitative observational study of performance pay in the public service was implemented by (Asch 1990), who collected data on the behavior of Navy recruiters, subject to a point-based performance system. The incentive consisted of a point-scheme for the quality of recruited candidates, a fixed time frame for evaluation and a minimum threshold of points needed to qualify for a bonus. Asch shows that 15