Can a Higher Wage Attract Better Quality Applicants without Deteriorating Public Service Motivation? Evidence from the Bangladesh Civil Service

Abstract

ABSTRACT Although the civil service plays a critical role in economic development, it performs poorly in many countries, partly due to civil servants’ low salaries. Therefore, in 2015, the Bangladesh government doubled the salary of civil servants. However, the reform may worsen public service delivery by attracting those who have lower public service motivation (PSM). Using the data of applicants to the Bangladesh civil service (BCS), this study examines the effect of the 2015 pay-scale reform on PSM. Taking a difference-in-difference approach, this study finds that the BCS officers hired after the reform are both academically smarter and more motivated to public service than those hired before the reform. Our results suggest that salary increases can be an effective for recruiting higher-quality officers.