Comparing the Effects of Changes in Performance Incentives and Implementation Activities on Policy Outcomes: Evidence from Air Pollution Emissions in China

In theory, performance rewards motivate agents to undertake activities intended to generate desired policy outcomes, especially in an authoritarian regime. This study examines implementation activities before and after the introduction of performance incentives in China. Using two measures of province-level emissions of sulfur dioxide (satellite observation and official report) from 2005 through 2010, the analysis shows weak evidence directly linking emissions reductions to implementation activities and the inception of performance incentives. The link is more observable using official data. The results suggest that, even in a centrally controlled institution, performance incentives may not be as effective as expected.