difficultly of selecting workers whose motivation is aligned with the mission of the institution -- in direct contrast to evidence …-wage argument, empirical evidence from developing countries suggests that motivation is weakly increasing in wages. This paper …-wage equilibrium. Importantly, the comparative statics of motivation and wage differ between the equilibria: starting from low …

State capacity is optimized when public institutions are staffed by individuals with public-service motivation. However … and low aggregate motivation (reputation) in the mission-oriented sector exist. Reforming a low-motivation institution … requires a non-monotonic wage path: since the effect of higher wages on motivation is negative for a highreputation institution …