International Encyclopedia of Public Policy and Administration - Vol. 2

By Jay M. Shafritz | Go to book overview

sion requirement translates into approximately 60 to 75 calendar days. Thus, rescissions remain a presidential fiscal policy option even though proposed rescissions must now be formally authorized by congressional action ( Congressional Digest 1993).

As indicated, the impoundment of appropriated funds (both rescissions and deferrals) have been used by presidents in budget and expenditure battles because they are the only fiscal policy tools available to the president to affect spending after the appropriation process is complete. Such actions may be initiated either for policy or for efficiency reasons.

Recent congressional actions severely restricted the use of rescissions, but deferrals are permitted under specific conditions. By contrast, the use of impoundments by governors has been limited. Quite possibly, the urge to utilize the impoundment option as a fiscal policy management tool at the state level has been limited because most governors have the opportunity to use the line-item veto to attempt to eliminate appropriations that they disagree with for either policy or efficiency reasons. The line-item veto has only recently ( 1996) emerged as a formal option for the president, but the issue of impoundments will likely continue as an issue of controversy between the president and Congress.



"Impoundment and the Item Veto", 1993. Congressional Digest (February): 34-39.

Wlezien, Christopher, 1994. "The Politics of Impoundments." Political Research Quarterly (March): 59-84.

INCENTIVE PAY . The use of extrinsic monetary and intrinsic psychological rewards to motivate increased or enhanced employee effort and performance (see pay- for-performance and performance appraisal).

Strategic pay requires that all decisions relative to compensation and benefits be designed to attract, retain, or motivate employees. As such, the entire organization's reward structure is designed to serve its mission or purpose fully. In reality, most organization's limit incentive pay to only a portion of the compensation package (see compensation policy and fringe benefits). All employees who perform satisfactorily are guaranteed a set base pay and benefits package. Even so, this guarantee serves to calm fears with regard to financial security and, hence, helps attract and retain individuals.

Extrinsic Rewards

Extrinsic incentives are, primarily, the use of monetary rewards as a motivating factor (see pay-for-performance for a more detailed discussion of extrinsic monetary rewards). Career development and training opportunities (see training and development) that can lead to promotion or to interesting, fulfilling assignments (which also provide intrinsic motivation through their recognition of merit) are another source of extrinsic motivation in the sense that, in addition to higher compensation levels, they pay individuals in terms of power and responsibility.

Intrinsic Rewards

The formal focus on the existence of intrinsic incentives as a part of incentive pay began with the development of industrial psychology following World War I. Scholars and practitioners who applied Frederick W. Taylor ( 1856- 1915) principles of scientific management noticed serious discrepancies with respect to its motivational aspects. Scientific management had heretofore dealt with employee motivation as a simple extrinsic function; for the most part, it was a simple task of relating salary to work. Totally ignored was the human dimension inherent in work. In the era's art deco culture, this human dimension was seen as harkening back to medieval craft notions instead of serving as a harbinger of modernity.

Because employers' experienced difficulties in their early efforts at using scientific management, due to employee resistance and a lack of motivation, they turned to psychologists (who had already begun to develop the tests used in selecting workers) for motivational answers on how to deal with these "sick" workers. For example, the Hawthorne experiments ( 1924-1932) at Western Electric Company's Hawthorne, Illinois, plant, conducted by Elton Mayo ( 1889-1949) and Fritz Roethlisberger ( 1898- 1974), highlighted this problem for management and contributed to the study of organizational productivity (see Hawthorne studies). Following this type of study came scholars from the human relations school, who focused on the intrinsic human aspects of motivation as a part of incentives. The popular contemporary motivational theories, Abraham Maslow ( 1908-1970) "needs hierarchy," Frederick Herzberg's ( 1923-) "Two-Factor Motivation HygieneMotivator Theory," and David McCelland ( 1917-) "achievement, affiliation, and power needs" theory, helped to establish intrinsic motivation as an important dimension (see Maslow, Abraham).

Maslow posited that human beings possessed preexisting, innate needs for sociability, recognition, and self-actualization (more recently, C. P. Alderfer condensed or simplified these to "relatedness and growth needs"). All of these are inherently psychological concepts intrinsic to the individual. Yet, because they are innate needs, these intrinsic factors serve to motivate individuals (by fulfilling physiological and safety needs) just as do extrinsic rewards.

For the public sector, intrinsic rewards are doubly appealing. First, intrinsic motivation programs are relatively


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