BTECH research seminar: Morten Lund Poulsen

Title: Incentives, Professionalism, and Loose Coupling: The Logic of Performance Funding

This paper draws on the institutional logic perspective and loose coupling to examine the implementation of a performance-funding program introduced by the Danish government. The aim of the program was to incentivise better educational outcomes for academically low-performing basic education students. The paper is based on a qualitative study of a Danish municipality’s response to the program, investigating its mediation down the organisational hierarchy. We use semi-structured interviews with administration members, school managers, and teachers. The administration allowed school managers to handle the performance-funding program. Managers responded through two sets of reactions drawing either on managerial or professional logic. The response was unexpected by the administration, who presumed the program was rejected because of a conflict between performance funding and professional values. The paper contributes to the literature by studying the setting in terms of institutional logics and organisational loose coupling through a logic of confidence. The paper demonstrates how the logic of performance funding can be enacted differently, drawing on different logics. Further, the paper highlights how incentives in performance funding, while situationally introducing new potential tensions, can be absorbed to align with professionalism and achieve policy intentions in a loosely coupled organisation.

Keywords: Institutional logics, Basic education, Performance funding, Professionalism, Public sector