The relation between public manager compensation and members of parliament’s salary across OECD countries: explorative analysis and possible determinants with public policy implications. Quaderni IRCrES, vol. 2, n. 2                      

Quaderni IRCrES 02/2017

The relation between public manager compensation and members of parliament’s salary across OECD countries: explorative analysis and possible determinants with public policy implications

 ^a Arizona State University, Center for Social Dynamics and Complexity, Interdisciplinary Science and Technology Building 1, 550 E. Orange Street Tempe, AZ 85287-4804 USA

^b CNR – National Research Council of Italy, Via Real Collegio, 30-10024, Moncalieri (TO), Italy

 * corresponding author: igor.benati@ircres.cnr.it  

The compensation for central government senior managers has been the focus of considerable attention from the public, media and academia in recent years. In several countries, the average compensation of public managers, especially top level ones, has risen in a way that public considers disproportionate and inequitable. In this context, there is a hot debate that the government senior managers are overpaid. A growing literature has analysed the possible determinants of com-pensation in public and private organizations. However, some political and institutional factors af-fecting public managers’ compensation are hardly known. Here, we show that the average compen-sation for central government senior managers seems to be positively associated to average salary of members of parliament (MPs), standardized with GDP per capita of countries. In addition, results show that higher levels of compensation for central government senior managers are mainly in countries based on Mixed Executive. We also show that higher public manager compensations are associated to countries with lower freedom of expression, freedom of association, free media, lower quality of contract enforcement, property rights and corruption control. These results can provide fruitful insights to support reforms and best practices that improve the efficiency of public administration, mainly in latecomer countries.

KEYWORDS: Compensation, Rewards, Wage for politicians, Pay for politicians, Bureaucracy, Public Managers; Executive, Public Administration, Public Policy.

JEL CODES: D72; H0; J3; J45.

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We gratefully acknowledge financial support from the National Research Council of Italy. We are also grateful to Lisa Sella, Secondo Rolfo and an anonymous reviewer for helpful suggestions and comments. The authors declare that they have no relevant or material financial interests that relate to the research discussed in this paper. Author contributions: Mario Coccia and Igor Benati have contributed equally to this study.