Pay-for-Performance, Motivation and Final Output in the Health - Sector: Experimental Evidence from the Democratic Republic of Congo

Abstract

The paper studies the effects of a financing mechanism for the health sector in which governmental payment to health facilities is contingent upon the number of patients for some predetermined health services, as opposed to a fixed payment. Even though performance-based financing models have been implemented in developed and developing countries in various settings and forms, the scientific evidence on its impact on health worker effort and consequent health outcomes remains thin. Using a field experiment in the Democratic Republic of Congo, we give evidence that financial incentives led to more effort from health workers with respect to rewarded services. Equally important, health workers did not substitute effort put in non-rewarded activities. However, the increase in overall staff motivation happened at the expense of its intrinsic component. Finally, the increased effort put in by the health workers proved unsuccessful at attracting more patients, suggesting that health workers lacked means or inventiveness to meet their objective. (with Juliette Seban)