distribution of effort across student groups, but properly designed incentives can mitigate such behavior (Jain and Narayan 2011).

# **_Public sector craft jobs_**

The evidence from experimental studies for public sector craft jobs is basically similar to that from observational studies – there is generally a positive impact but the limitations are also similar, in that the evidence is largely from OECD countries with the significant exception of teaching and health care where several significant experiments have been undertaken in developing countries.

# **Tax administration, job placement**

(Burgess, Propper, et al. 2010) use a randomized controlled trial (RCT) to examine the impact of a pilot team-based incentive scheme introduced in 2002 in Her Majesty‘s Customs and Excise (HMCE), the indirect tax assessment and collection agency of the UK government. Each team consisted of a small number of tax offices, and ranged from 150 to 280 workers; there were two treatment teams that received two different types of incentive payments — one a bonus that was a fixed percentage of the officer‘s salary and the other a flat rate bonus — and a control team. The incentive scheme for both the treatment teams consisted of meeting a set of targets on revenue collection and conduct of audits, with an average bonus size of approximately 3% of annual salary. If the target was met than all staff in the team received the bonus. The authors‘ use detailed data from the HMCE‘s performance management system and personnel records to show that the tax yield increased for both the treatment teams relative to the control group, and that these increases were due to more time spent auditing that resulted in the recovery of greater tax revenue. The study also found that the strategies of the two incentivized teams were different, with the managers in team 2 allocating more incentive tasks to efficient workers than managers in team 1. Whether the flat rate bonus structure contributed to this task allocation was not examined.

(Burgess, Propper, et al. 2011) also did another RCT to examine the impact of a team-based incentive scheme introduced in a large UK public agency, Jobcentre Plus, which is tasked with placing the unemployed into jobs and administering welfare benefits. Each team consisted of a district, which had several offices, ranging from 250 to 1500 staff. There were 17 treatment districts and 73 control districts. The incentives were based on achieving both quantitative and qualitative targets — number of individuals placed in jobs, customer and employer service, and reducing benefit calculation error and fraud. The job placement target was weighted by the types of clients who found employment (e.g. highest weights to an unemployed single parent) with extra points if the person retained employment. While individuals worked in offices, the targets were set at the district level, which consisted of many offices that operated independently of each other, a potential flaw in the schemes design. The study was explicitly designed to assess the impact of incentives given multi-dimensionality of tasks, as well as possible free-riding given the nature of the team incentive.

The study‘s findings were that while overall there was little difference between the treatment group and the control group on job placement, in smaller teams (fewer offices per district, and smaller offices) the incentives resulted in 10% greater job placements than in the control group, with the effect declining for larger districts such that there was a significant negative impact on productivity for the largest quartile of districts. This suggests considerable free-riding behavior in larger teams. The authors also found that none of the quality measures were significant in the treatment group, irrespective of team size, suggesting that measurement problems were important.

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