The Effect of Pollution and Heat on High Skill Public Sector Worker Productivity in China
The quality of governance depends on public sector worker productivity. We use micro data from China to document that judges are less productive on polluted days. Building on the insights of Alchian and Kessel (1962), we discuss the role of organization design and the incentives of public versus for profit organizations in designing a workplace that reduces the productivity costs of local disamenities. We find that the public sector productivity elasticities are larger than published estimates of the private sector productivity elasticities with respect to pollution.
We would like to thank Edward Lazear for a useful discussion. All errors remain our own. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.