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Motivational Crowding Out in the Public Sector: The Culture of “Nipe Kitu Kidogo” in Kenya from a Behavioral Science framework, and what can be done about it.
Kenya is ranked 144 out of 180 countries in corruption globally according to Transparency International index (Transparency 2018). According to the Corruption Perception Index of Transparency International, Kenya has a score of 27 out of 100 on a scale in which 0 represents highly corrupt, and 100 represents very clean. It has one of the least transparent institutions in the world having a poor ranking of 145th of the most transparent countries out of 180. Despite many anti-corruption reform measures taken by the Kenyan government that strives to uphold democracy, at least constitutionally, the state is failing to decrease corruption at significant levels. Corruption is the main barrier to Kenya’s competitiveness in the global economy and also hinders social development for its people. It has penetrated all public sectors like health, education, water, security and permit sectors, and significantly undermined the rule of law. In this paper, I will be focusing on bribery, the Kenyan culture of “Nipe kitu kidogo,” a street language expression which in English translates to give me something small for appreciation. This expression epitomizes the impunity present in the country. Bribery is mostly a cultural norm in the country. It is conceived to be a rational mechanism of enhancing efficiency considering Kenya’s weak institutions and lack of adequate accountability mechanisms avoiding cumbersome and inefficient regulation (Rose Ackerman 1978). Extant anti-corruption laws have failed to make serious inroads against corruption; thus, innovative strategies should be researched and adopted considering corruption is a worldwide struggle and top policy priority, especially for developing countries characterized by weak democratic foundations and institutions. The objective of my research is to look at bribery in Kenya from a behavioral science lense to improve the future design of policy to address bureaucratic corruption that undermines institutional capacities and accountability.
In this research, I will examine corruption, particularly bribery, in Kenya through the framework of motivational crowding theory in behavioral economics. I briefly analyze other behavioral science theories vis-à-vis to motivational crowding out. I do so to illuminate new insights that can guide policymakers in their strive to combat corruption. In the first section, I will give an overview of the complexities of graft in Kenya through a motivational crowding lense. In the second section, I will discuss briefly what anti-corruption reforms have been tried, and why they may not have worked drawing on lessons learned from a motivational crowding out the framework. I will also take a comparative approach to draw out lessons from other national contexts (Hong Kong, Nigeria, Singapore, Maldives) in the fight against corruption. In the third section, I will recommend an intervention, the implementation of a commitment contract mechanism in the public services, and expound on guiding strategies for its implementation through a Mindspace framework.
According to research done by Michael Mbate on who bears the burden of bribery in public service delivery in Kenya, it is poor. The burden of bribery varies with the type of public service. The poor are more likely to pay a bribe, especially in health and education, services the rich can exit from and seek alternative private suppliers because of their income constraints them from accessing private services. Thus, they are more vulnerable to bureaucratic extortion, and the propensity to bribing depends on one’s socio-economic and political background. Those who face many income constraints are more likely to pay bribes. Mbate also found through his regression model that the poor are 6.9% more likely to pay bribes than the rich in exchange for public service. The ethics and Anti-corruption commission in Kenya reported that when t users of public health facilities, 64% of whom are low-income people. Get sick, 20.7 % of them are required to pay bribes to be attended to (2016). Thus bribery acts as a regressive tax and discriminating mechanism for access to public services. Although the poor are more likely to pay bribes than the rich. They don’t pay the same amount of money. The rich pay higher amounts, which leads to bureaucrats’ class prejudice against the poor who can’t afford the rich people’s price. Those with political capital are also more likely to pay bribes because they are associated with interest groups with power. This is because their socioeconomic status undermines their bargaining power and ability to defend their rights. Mbate reported that Bureaucrats sometimes intentionally imposed hurdles to get citizens to pay extra “fees to obtain permits. I have personal experience of this. In 2018, I tried to obtain a license to register a society formally. Part of the requirements was creating a constitution. The first time I submitted the documents, they were not accepted due to specific wording in the law. When I went to seek assistance which is part of the task assigned to bureaucrats in that particular office, a bureaucrat offered to help me write the constitution, a task her salary covered, if I paid her two thousand shillings (20 dollars) on the side without a receipt.
The class prejudice present in corruption practices proves the knavish (self-interested) character of bureaucrats, unlike classical economic theory that portrays them as knightly, public-spirited altruists. It also shows that citizens are not necessarily pawn-ish, passive recipients of the state, but also can act in illegal ways to maximize their well-being. Thus this research is conducted under the validity of Julian Le Grand’s findings that we should assume bureaucrats are knaves rather than knights and design incentive mechanism so that interests are channeled to serve the common good (Le Grand 2003). I hope to develop a more robust policy that does not rely on intrinsically motivated workforce assuming bureaucrats are knights rather than knaves. Bureaucrats are prone to the same irrationalities as the rest of society too.
Motivational Crowding- Richard Titmus who coined the term motivational crowding found that monetary compensation tends to undermine the individual sense of civic duty. It is a term derived from social psychology. He defines motivational crowding out, as the perverse effects of incentivizing behavior. It is when a high incentive leads to lower supply. He found this by investigating crowding out in blood donation. More people were willing to donate blood before monetary incentives were introduced. Being paid to donate crowded out those who were willing to give blood freely in the first place. This shows that the introduction of monetary incentives was economically inefficient and had detrimental effects on the supply. He also explained the moral value of altruistic incentives rather than a payment. He showed paying for donations decreased intrinsic motivation, and this could have negative consequences such as changing people’s perception. It undermined people’s willingness to give out of regard for the needs of others. By intrinsic motivation, I refer to the activities one partakes in because they derive satisfaction from doing it out of altruism or a sen(). His research, he found that after incentives were introduced only 50% reported they would donate as often as they did after payments were withdrawn. He was focusing on crowding out of intrinsic motivation. The same concept applies to other public services. According to Titmus, when monetary incentives are introduced as a reward for engaging in an activity, intrinsic motivation is crowded out.
Titmuss found that offering incentives did not increase the quantity of blood donated, and it only introduced additional costs. It had no impact on the amount or quality of blood, which goes against the price effect in classical economic theory. Further, Titmuss found that introducing incentives decreased quality because it attracted high-risk donors. Other researchers found the same result in their studies. Mark R and Lepper and David Green had the same results. Solow and Keneth build on the importance of considering the detrimental effects of using price incentives. Further, so and so identifies limits of price incentives in garnering support for the socially desired enterprise. A second study on volunteers by Frey also showed that payments were found to reduce work effort rather than increase it.
In a study, Adam Oliver if the UK and US health sector found that there were some improvements in the performance of hospitals when monetary incentives were introduced. However, the improvement was very marginal and did not represent good value for money. Tangible rewards undermine motivations for tasks that are intrinsically valued, such as civic duty. Ariely et al. in 2009 also concluded that incentives undermine performance in work that is held of intrinsic worth. It leads people to focus on the profit rather than the service they provide.
Also, Frey and Oberholser who did one of the most renowned studies on motivational crowding study showed that after price incentives were introduced, 50% of intrinsic motivation and sense of civic virtue was crowded out.
In the case of public service, it can follow that the reason quality of quantity of service diminishes when monetary incentives are introduced is that financial rewards act as a signal to people, that whatever, is expected of them is not a civic duty. Monetary compensation destroys altruistic values. Furthermore, the Kenyan government has taken various initiatives to combat corruption. So far, gov has engaged in the mostly negative incentive of reputational damage for bad performance, instead of increased autonomy for an excellent performance. According to so and so…through this approach, there is a risk of demoralizing and demotivating bureaucrats to because external interventions are deemed controlling.
Furthermore, there is no guarantee that civil servants won’t act knavishly in response to financial incentives. Considering the financial constraints of the Kenyan government, it can be detrimental if the non-incentivised practice is crowded out as a consequence. If the government seeks to garner up intrinsic motivation and promote political will, we should assume bureaucrats are knaves rather than knights and that we should design incentive mechanism so that interests are channeled to serve the common good (Le Grand 2003). Many public sectors rely on intrinsically motivated workforce assuming bureaucrats are knights rather than knaves. They forget bureaucrats are prone to the same irrationalities as the rest of society too.
Many components could be credited as one of the main problems promoting corruption; hence, the scope of research on corruption and all its manners and forms is so broad. It is also essential to establish that human behavior is influenced by both extrinsic and intrinsic motivation. The former is controlled by the outside environment and the latter. Dolan et al. through a series of studies showed that behavior is significantly impacted contextual factors. Contexts influence people’s thoughts or cognitive model as well. This occurs through the conscious reflection of the surrounding environment. Behavioral scientists have already established that people are irrational and inconsistent in their choices, sometimes because of external influences (Thaler and Sunstenin 2008). Deci and Ryan add that behavior that is associated with a societal standard or value or essential norm. Behavior can also be controlled by external regulation. I hope to come with a policy that taps into internal regulation. This will also be introjected motivation in this sense. The hope is that gradually, people’s motivation and intrinsic motivation can be built up so that regulatory control eventually turns into introjected control, and people learn to identify personally into the policy. Deci and Ryan also found that behavior change interventions have greater results when people feel that their autonomy is maintained when they act in a certain way. According to self-determination theory, introjected behaviors are the best approaches to securing behavioral change (Oilver, 2017). The hope is that values like integrity will be a broadly held individual value and social norm to some extent.
This paper has shown that price incentives whether in the form of corruption, bribery or legal performance incentives are highly detrimental to public sector services, because they crowd out intrinsic motivation, and expectations of additional payments for services become a norm. It is likely what led to gaming activities, both via corruption and via payments for performance improvements, which pose a significant risk to the efficiency of the government (Oliver, 2017). In the health sector, for example, performance incentives may lead to bureaucrats neglecting more complicated cases harder to reflect an improvement on, leading to cheating. The risk of gaming adds cost in the long run and should be considered before the government continues with a performance contract. They should weigh the costs and benefits from performance mechanisms. Performance contracting may also lead to more severe market failures, information asymmetry principal-agent problems due to the unequal power existing between principal and agents. In the long run, performance contracting may be undermining the functionality of government and society as a whole.
I will use the book Mindspace’s framework to present robust evaluations of the intervention I recommend, and it cost effectiveness guidelines on how the intervention I propose could be implemented. Mindspace is a set of instructions on how behavioral economics could be applied to decision making in the public sector. According to Dolan et al., our behavior is significantly impacted by the environment. Dolan et al. separate the cognitive process of environments influencing people into system 1 and system 2. System 1 focuses on the automatic drivers of behavior that are in the environment without changing one’s mind. The system focuses on improving the mind.
According to Dolan et al., people are more likely to respond to information when the messenger has similar characteristics to the people. Also, people are more likely to disregard advice that comes from people they dislike to the extent of traditional authority; in this case, the government may be overridden. Lower social, economic groups are more sensitive and influences by characteristics of the messenger (Cialdini 2007). This is evident in Kenya, as many Kenyans still elect their government representatives based on racial lines rather than merit, and 40% of Kenyans live below the poverty line. These findings could have implications on the effectiveness of my intervention considering the reputation of the government in Kenya that is highly mistrusted. Potentially, because the government would be the one in the best position to implement my intervention, they would need to re-establish trust among citizens to maximize its effectiveness. The media can be used as a tool to change the mindset ordinary citizens and bureaucrats have of the government.
There are other cues from Mindspace that are relevant to my subject. According to Dolan et al., societal norms are influenced by what others do. People tend to choose the pre-set option as well. Also, according to Mindspace’ commitment cue, “people seek to be consistent with the public promises and reciprocate acts they. People also act in ways that make them feel better about themselves. The commitment cue will be my main focus since my intervention is the implementation of a commitment contract mechanism of combating corruption. But I will design my response mindful of other behavioral economic cues.
Mindspace also outlines other vital factors that influence people responses to incentives: Their memory influences people. In this case, if it easy to recall a person who was successfully penalized for corruption, then people are more likely to be deterred from the crime. Moreover, according to behavioral science, people are influenced by what people see or think others are doing rather than the classical normative theory that norms depend on what people ought to be doing (Cialdini, Kallgren) The government of Kenya can work with the media to create many reference points by publicizing a few cases of perpetrators successful tried and punished for their crimes. The media can play a crucial role in sensitizing citizens on the norms that are desirable and changing the image people have of government by publicizing the implementation of such interventions or drawing attention to cases in which perpetrators were successfully followed up by the law and punished. Media can be used to shame both the briber and bribee. The media To persuade American citizens to get into a habit of wearing seatbelts, there was a media campaign called “Most of us wear seatbelts campaign, that successfully increased the number of people using belts, because it changed people’s perception into thinking, that wearing seatbelts had become the norm in society. By publicizing the intervention, then people can also be empowered with information and use it to hold bureaucrats accountable. That is why it is necessary to publicly display the commitment contract bureaucrats take in public offices where the citizens being served can easily see and refer to in case of a corruption incidence.
The government agency who launches this intervention will also need to ensure that they too keep themselves honest. Dolan et al. explain that efforts to change the norm into a more desirable one, like shifting the Kenyan norm from graft into honesty, backfire if the messenger behaves in an undesirable manner. As the Christian saying goes, you can’t be preaching water and drinking wine. For the intervention to be successful, the agency is implementing the intervention whether the independent ethics and anti-corruption commission, must live to the standards they set for bureaucrats, for bureaucrats to truly commit. Moreover, commitment’s success largely depends on reciprocity, which is a robust human instinct. Innately people desire fairness, and thus, have an attitude of I’ll commit to it if you do…” People fulfill essential tasks on the expectation that others won’t fall short of fulfilling theirs. On the other hand, another study of commitment contracts in the Maldives showed that there is a positive correlation between trust in employer, and the strength of the commitment in that it mediates. The length of the contract is also positively correlated to the impact it has on people’s commitment to desirable values. People with longer entrepreneurship in an organization show more loyalty to the organization. , but it does not have a significant impact on commitment.
It is essential for policymakers to consider this because many public sectors have been engaging in the rotation of employees as an anti-corruption mechanism. This reform was recommended based on studies that showed, that reducing contact of employees may help combat corruption. On the other hand, based, behavioral science seems to reveal the opposite effect. More research needs to be done on whether it matters one’s commitment if someone is rotated into a different branch of the same organization. Based on these findings, perhaps the government rather than striving to rotate bureaucrats, into different departments or government institutions, the government should strive to offer longer-term contracts to its employees to strengthen their commitment.
Thus the government has to ensure they treat bureaucrats fairly and not unjustly. Furthermore, those whom injustice has been done against are more likely to project the same injustice to others.
The commitment contract will not depend on tangible rewards keeping in mind the risk of motivational crowding out I have expounded on in the first section of my research.
I intend my intervention, the commitment contract to be a reflective action bureaucrat take that influences them not only cognitively, but also externally. Thus, bureaucrats should be required to write down the commitment. Cialdini claims that the writing down of commitments increases the likelihood of it being fulfilled. To ensure that the memory of commitment contact is retained and does not become distant. I recommend that the commitment contract should be recited every time a new bureaucrat is hired into the institution, and like Singapore, there is one week in the year, allocated to celebrate national values nationwide, in which bureaucrats recommit to the contract. That is why it is necessary that part of the process of the commitment contract be made a ceremony, so all in the government institution take together. Policymakers should keep in mind that reciting the commitment contract too often, may lead to desensitization, that may cause the contract to lose meaning. Be careful not to recommend the recruitment Because other co-workers in each instance will be present in the reciting of the commitment, and the commitment will be made public, then people are more likely to stick to the commitment to avoid reputational damage or being excluded from the group. The hope is that by creating a new culture through the commitment contract, then gradually, one’s cognitive choice architecture is transformed into the right direction.
A study of “the Impact of Psychological contract on organizational commitment in the Maldives shows that in the presence of a commitment contract. People tend to associate a deeper pride and meaning to work. A strong sense of belonging is also promoted through ceremonial processes. Hassan et al., adds that a psychological commitment also fosters job satisfaction, production, and customer satisfaction. This study also shows that poorly established contracts could lead to disengagement in work.
The case of Maldives psychological contract also reveals another critical component of a commitment contract.
I am not proposing my intervention as a panacea to eradicate corruption. A commitment contract should be accompanied by other anti-corruption mechanisms that impose penalties that make the costs of engaging in graft more than the reward. But this accompanying anti-corruption reforms should not be overemphasized on more than the commitment contract itself to avoid demotivating public servants if they feel villainized. The commitment contract will make the anti-corruption mechanism less coercive.
Commitment contract can act as a way to create the perception that there are higher expectations placed on bureaucrats. Studies have shown that people perform better when there are higher expectations placed on them. This is known as the Pygmalion effect in which ones person’s expectations of another’s behavior becomes somewhat a self-fulfilling prophecy.
Limitations
A study on Hong Kong and Singapore, two countries who are ranked top 20in the list of least corrupt countries highlight the importance of having adequate funding for anti-corruption reforms to be effective. They compared these two countries with Nigeria, one of the most corrupt nations in the world. Awepeju et al., in his study, highlights that one of the reasons Nigeria anti-corruption agencies have not been successful in combating corruption is that their agencies lack adequate funding and lack the political will. Often high profile personalities engaged in bribery and caught have more money to their disposal than prosecuting agencies, thus can escape penalties. Awepeju et al., recommends after his findings that the Nigerian government should accordingly allocate more of their national budget to anti-corruption agencies. However, his recommendations subscribe to a normative approach against corruption, stating what should be in the ideal world. However, the reality is that most governments of developing countries in Africa, like Kenya, face institutional incapacities and severe challenges in funding. A shortage of national funds. Perhaps also, in the grand scheme of things, resources are plentiful, but they are squandered through fraud due to the lack of political will and proper accountability mechanisms to keep bureaucrats in check. Thus, increasing budgetary allocation to Anti-corruption agencies may not be feasible. I propose a more descriptive approach in the sense of a more affordable way to combat corruption while simultaneously promoting a stronger political will needed to prevent ample government resources from being squandered.
My proposal is a cost-effective multifunctional mechanism that can potentially transform societal norms for the better by enforcing high moral standards in a non-coercive manner. , and strengthen bureaucrats political will. By changing bureaucrats choice architecture through a commitment contract, the hope is that once the individual is changed, the environment will follow suit.
My research is very timely, considering the Nairobi City council assistant director has been advocating for better rewards in performance contracting. She like many others claims that public recognition and ranking of best-performing employees has not been enough motivation for civil servants to perform better, frustrating government employees and that monetary rewards should be added to reward the achievements of targets. Her recommendation seems to be based on the classical economic theory that price incentives produce better performance, ignoring the context in which many of the people in power and with influence on bodies like the Nairobi City council have a network of corrupt individuals who could tweak performance contracting results through gaming. As I have shown through an analysis of motivational crowding out the theory, incorporating monetary reards is likely to undermine intrinsic motivation and the ethos of the Kenyan public sector that is associated with sacrifice and an obligation to civic duty. This is likely to change social relations in a context where illegal “monetary rewards” via briber is prevalent and undermines efficiency and political will.
Another strength of my intervention of a commitment contract is that it has roots in Kenya’s colonial history. One of the strategies the Mau Mau Independence movement against colonial powers used to succeed in gaining independence for Kenya was requiring members to take oaths during oath ceremonies. It was an oath of unity, and breaking the oath invoked a curse on the oaths and their families. It was a powerful mechanism for Mau Mau movement that was a precursor to Kenya’s declaration of independence in 1963.
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