Why Are Counterfactual Assessment Methods Not Widespread in Outcome-Based Contracts? A Formal Model Approach Get access Arrow

dc.contributor.authorSERGIO GIOVANETTI LAZZARINI
dc.contributor.authorSANDRO CABRAL
dc.contributor.authorFirpo. Sergio Pinheiro
dc.contributor.authorTeodorovicz, Thomaz
dc.coverage.cidadeNão informadopt_BR
dc.coverage.paisNão Informadopt_BR
dc.creatorFirpo. Sergio Pinheiro
dc.creatorTeodorovicz, Thomaz
dc.date.accessioned2022-10-14T21:27:50Z
dc.date.available2022-10-14T21:27:50Z
dc.date.issued2022
dc.description.otherCounterfactual assessment techniques involving treated and control groups, such as randomized control trials, might be used in outcome-based contracts to avoid rewarding or sanctioning service providers for social outcomes that they did not cause. However, few outcome-based contracts adopt payment rules based on counterfactual assessment techniques. Potential explanations are that these techniques are complex and involve substantial transaction costs. In this paper, we develop a theoretical formal model that integrates the literatures of incentives and policy evaluation to propose the following alternative explanation: counterfactual techniques may lead to counterproductive incentive effects if they reduce the likelihood of payment even if project managers exert sufficient effort to promote the expected interventions. Our model shows that counterfactual assessment may undermine effort when the number of treated subjects is small and there is limited investment per treated subject. Our formal model also suggests that the increased experience of the contract sponsors may inhibit the adoption of counterfactual assessment. Simulations and descriptive evidence from a unique database of 350 outcome-based contracts designed or initiated throughout the world and from linear probability models are aligned with our predictions. By offering additional explanations on why counterfactual assessment methods are not widespread in outcome-based contracts and by identifying the boundary conditions under which these methods are used in incentive contracts, this work informs the literature on cross-sector outcome-based contracts and illustrates the use of formal models to develop novel theories in public administration.pt_BR
dc.format.extentp. 509-523pt_BR
dc.format.mediumDigitalpt_BR
dc.identifier.doihttps://doi.org/10.1093/jopart/muab052pt_BR
dc.identifier.issue3pt_BR
dc.identifier.urihttps://repositorio.insper.edu.br/handle/11224/4300
dc.identifier.volume32pt_BR
dc.language.isoInglêspt_BR
dc.publisherOxford University Presspt_BR
dc.relation.ispartofJournal of Public Administration Research and Theorypt_BR
dc.relation.urihttps://academic.oup.com/jpart/article-abstract/32/3/509/6485792pt_BR
dc.rights.licenseO INSPER E ESTE REPOSITÓRIO NÃO DETÊM OS DIREITOS DE USO E REPRODUÇÃO DOS CONTEÚDOS AQUI REGISTRADOS. É RESPONSABILIDADE DOS USUÁRIOS INDIVIDUAIS VERIFICAR OS USOS PERMITIDOS NA FONTE ORIGINAL, RESPEITANDO-SE OS DIREITOS DE AUTOR OU EDITOR.pt_BR
dc.subject.keywordsNão informadopt_BR
dc.titleWhy Are Counterfactual Assessment Methods Not Widespread in Outcome-Based Contracts? A Formal Model Approach Get access Arrowpt_BR
dc.typejournal article
dspace.entity.typePublication
local.typeArtigo Científicopt_BR
relation.isAuthorOfPublication4ee022f9-7466-405d-ae1a-6b1e33f611e8
relation.isAuthorOfPublication76c81ecd-5a8e-48de-9d12-b62cebc2e626
relation.isAuthorOfPublication.latestForDiscovery4ee022f9-7466-405d-ae1a-6b1e33f611e8
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