Performance and Pay in the Public Sector: the Case of the Local Tax Assessor

Abstract

Because it is unclear, theoretically, if the compensation of public employees is based on performance, this study empirically examines the various factors underlying tax assessor pay. As neoclassical theory suggests, performance, as measured by assessment uniformity, is found to positively affect tax assessor pay. In particular, a 10% increase in assessment uniformity is shown to result in a 1.7%-2.3% increase in tax assessor pay, ceteris paribus.