524540

research-article2014
PPMXXX10.1177/0091026014524540Public Personnel ManagementCampbell et al.

Article
Public Personnel Management
2014, Vol. 43(2) 259­–282
Internal Efficiency and © The Author(s) 2014
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DOI: 10.1177/0091026014524540
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South Korea

Jesse W. Campbell1, Tobin Im2, and Jisu Jeong2

Abstract
All around the world, public organizations have faced strong pressures to improve
performance and generally “do more with less,” particularly following the global
slowdown of 2008. This article examines the effects of organizational emphasis on
efficiency in local government using data from a large survey of civil servants in South
Korea. Findings from a fixed effects analysis indicate that higher levels of efficiency
emphasis are related to stronger employee turnover intention. However, a number
of moderating factors are also uncovered, suggesting that individual levels of public
service motivation as well as perceived procedural justice and innovation climate can
influence this relationship, lessening the impact of efficiency emphasis on turnover
intention. These individual and organizational level factors may thus act as a buffer for
increased performance demands. A number of implications for public management
are discussed.

Keywords
turnover, efficiency, PSM, innovation, procedural justice

Introduction
A greater emphasis on efficiency has been a central refrain of public administration
theory and practice over the past decades (Frederickson, 1996; Peters & Pierre, 1998;
Stoker, 2006). Since the beginning of the 2008 economic downturn, and more recently

1Chung-Ang University, Seoul, South Korea

2Seoul National University, South Korea

Corresponding Author:
Jisu Jeong, Graduate School of Public Administration, Seoul National University, 57-1 dong, 1 Gwanak-ro,
Gwanak-gu, Seoul, South Korea 151-742.
Email: jsjeong@snu.ac.kr

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260 Public Personnel Management 43(2)

in the European states, austerity programs of various designs have been broadly intro-
duced, pushing the “do more with less” philosophy of the Reinventing Government
movement to its limits (Gore, 1993). While there is an intuitive link between an
increased emphasis on productivity and cost cutting in public organizations and
employee behavior and attitudes, however, this relationship has not been sufficiently
explored in the public administration literature. As an important dimension of organi-
zational performance, achieving higher levels of efficiency for public sector organiza-
tions is both desirable and necessary. However, understanding the full range of
consequences related to efficiency-orientated initiatives, and particularly how these
affect the human capital of public organizations, is required to prevent these initiatives
from backfiring.
Employee turnover is tied fundamentally to organizational performance in the pri-
vate and the public sector (Khiljia & Wang, 2006; Meier & Hicklin, 2007). The
recruitment and training of new employees represents an upfront investment for orga-
nizations, and losing these employees to voluntary turnover can result in significant
costs and other negative consequences (Kellough & Osuna, 1995; Lewis, 1991).
However, voluntary turnover can be beneficial to organizations when those who leave
are poor performers, when it opens up positions to new recruits with fresh insight into
standing problems, or encourages those who stay to perform at a higher capacity
(Meier & Hicklin, 2007; Kellough & Osuna, 1995; Stahl, 1962). At the same time,
however, while the link between organizational performance and turnover is theoreti-
cally interesting and empirically confirmed, little work has been done to investigate
whether the performance orientation of public organizations affects employee inten-
tions to leave their jobs. In particular, the efficiency-related dimension of performance
initiatives, insofar as they affect the workload and resources of employees, may have
distinct effects. This study makes a contribution to the theory of turnover in public
organizations by modeling organizational emphasis on efficiency as an independent
variable.
Other individual and organization level factors have been known to influence
employee turnover intention, and this study explores how a number of these factors
may act as a buffer to the effects of efficiency emphasis. First, Public Service
Motivation (PSM) has been connected to a number of behaviors and attitudes desir-
able from an organizational perspective, including reduced turnover intention (Bright,
2008; Moynihan & Pandey, 2008). Employees with high levels of PSM have been
shown to be less affected by bureaucratic conditions (P. G. Scott & Pandey, 2005), as
well as exhibit higher levels of organizational commitment and job satisfaction
(Crewson, 1997; Naff & Crum, 1999). This study tests whether PSM may shield
employees from the effects of an increased emphasis on efficiency in public organiza-
tions. Second, procedural justice and innovation climate have been linked to lower
turnover intentions in various ways (González-Romá, Peiró, & Tordera, 2002; Rubin,
2007), and this study looks at how these organization level constructs may moderate
the relationship between efficiency emphasis and turnover intention.
Managing employee job motivation and turnover rates is an important element
of the human capital strategy of public organizations. This study tests empirical

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Campbell et al. 261

hypotheses related to turnover intention in the public sector using data drawn from 228
local government organizations in South Korea. This study aims to make a theoretical
contribution to the literature on turnover intention in the public sector by demonstrat-
ing how PSM may shield government workers from the potentially negative effects of
efficiency-related initiatives in public organizations. From a practical perspective, this
study also offers guidance for public managers involved in the pursuit of efficiency.
These findings may prove to be valuable for public managers operating in austerity-
orientated public sectors.

Theoretical Background
Turnover Intention
Turnover intention is the cognitive process of thinking about quitting one’s job, plan-
ning on leaving, or feeling the desire to leave; research has shown that turnover inten-
tion is the strongest predictor of voluntary turnover (Lambert, Cluse-Tolar, Pasupuleti,
Prior, & Allen, 2012). March and Simon (1958) conceptualized employee turnover
intention as related to an employee’s decision to participate in and exert effort on
behalf of the organization. This formulation therefore linked turnover directly to orga-
nizational performance (Khiljia & Wang, 2006). A phenomenon with significant prac-
tical implications, turnover imposes costs on organizations in terms of hiring, training,
and the loss of institutional memory, and generally turnover is understood as nega-
tively related to performance in both the private (Shaw, Gupta, & Delery, 2005) and
the public sector. However, turnover can be a positive occurrence if it leads to the
replacement of low performing employees with high performing ones (Meier &
Hicklin, 2007; H. Y. Park, Ofori-Dankwa, & Bishop, 1994), thereby offsetting short-
term losses with long-term gains.
A number of studies have examined turnover intention in public organizations.
Selden and Moynihan (2000) found that opportunities for internal movement as well
as pay rates were negatively associated with turnover intent, as were unionization rates
and the availability of onsite child care. Moynihan and Landuyt (2008), on the con-
trary, found that a number of demographic variables contributed to the intention to
leave the organization, including minority status, household size, and whether or not
respondents were the primary income earners for their families, in addition to age and
agency experience. Turnover intent has been shown by Moynihan and Pandey (2007)
to be negatively associated with age, experience, obligation felt toward coworkers,
coworker support, and person/organization fit. S. Y. Lee and Whitford (2008) found
that a greater opportunity to influence organizational activities as well as managerial
behavior that fosters loyalty among front line employees were significantly related
with the intention to stay, as were extrinsic incentives and benefits. Finally, G. Lee and
Jimenez (2011), focusing on the link between performance management and turnover
intention, demonstrated that both the existence of performance-based incentives as
well as the performance orientation of supervisors significantly reduced intentions of
employees to leave the organization.

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262 Public Personnel Management 43(2)

While these studies provide some insight into the nature of employee turnover
intention in public organizations, the subject has still not received as much attention as
it has in the private sector literature (G. Lee & Jimenez, 2011). In particular, research
has yet to examine the relationship between turnover intention and factors related to
the performance orientation of public organizations. The next section addresses this
topic by discussing the potential impact of efficiency emphasis on employee intentions
to leave their jobs.

Efficiency Emphasis and Turnover Intention

In the face of declining confidence and trust in public organizations, public sectors
around the world have sought to enhance public organizational performance by shift-
ing their emphasis from input and process-based controls to outputs to increase
accountability and cut costs (Boland & Fowler, 2000). In addition, budget constrained
public sectors have faced downsizing and restructuring programs (Staufenbiel &
König, 2010), thus motivating the need to do more with less (Gore, 1993) from a prac-
tical perspective.
While in the private sector performance can often be measured in a straightforward
way through the use of financial indicators, defining an appropriate concept of organi-
zational performance for public sector organizations is more challenging. One impor-
tant effort that has been built upon extensively is Brewer and Selden’s (2000) categories
of efficiency, effectiveness, and fairness. These categories can be applied to the inter-
nal operations of the organization as well as to its dealings with the public. From the
internal perspective, fairness relates to the equitable and transparent treatment of orga-
nizational members, while effectiveness relates to the development and utilization of
human capital. Internal efficiency, however, can be understood as a more quantitative
construct aimed at maximizing the ratio of output to cost. While the concept of perfor-
mance has always been an important part of the public administration literature and
practice, the New Public Management (NPM) reform movement in particular has laid
a great emphasis on raising the internal efficiency of government organizations. These
reforms have been pursued on a global scale, moreover, and while there are contrasts
between various national programs, the drive to increase efficiency has been central to
the global reform program (R. B. Denhardt & Denhardt, 2000; Frederickson, 1996).
A strong emphasis on the internal efficiency dimension of organizational perfor-
mance in public organizations may affect employees in a number of ways. First, an
emphasis on efficiency, understood as the simultaneous demand to increase productiv-
ity and decrease costs, is related to both the performance expectations and resources of
employees. If job resources do not rise in tandem with job demands, employees may
suffer stress, burnout, and other negative psychological as well as physical problems
(Bakker & Demerouti, 2007; Schaufeli, Bakker, & Van Rhenen, 2009). Moreover, the
incongruence between job demands and resources is an important factor in workplace
role overload and role conflict, which have been shown to be closely related to job
stress and turnover intention (Fang & Baba, 1993; Jones, Chonko, Rangarajan, &
Roberts, 2007). Insofar as employees consider leaving their jobs as a coping

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Campbell et al. 263

mechanism to deal with increased job demands, efficiency emphasis in public organi-
zations may facilitate turnover intention (Jones et al., 2007).
A second line of reasoning relates to the nature and perceived goals of public orga-
nizations more generally. Long ago, Hood (1991) pointed out that one criticism of the
NPM-driven performance movement was its overemphasis on “bottom line ethics” (p.
10, quoting Jackson, 1989). At its extreme, this outlook is charged with disregarding
equity within organizations by increasing top down managerial empowerment at the
expense of front line employees. In their New Public Service manifesto, R. B. Denhardt
and Denhardt (2000) and J. V. Denhardt and Denhardt (2011) argued that while strate-
gies of efficiency improvement in organizations are necessary and desirable to a cer-
tain extent, if insufficient attention is paid to the citizen-centered values of public
organizations, public managers risk lower levels of employee commitment, particu-
larly among the most civic-orientated employees.
Based on the reasoning presented above, this study proposes the following
hypothesis:

Hypothesis 1: Efficiency emphasis is positively related to turnover intention.

Individual Level Moderator: PSM

The service-orientated missions of public organizations discussed by Denhardt and
Denhardt have long been thought to attract a certain type of individual. PSM, defined
as “an individual’s predisposition to respond to motives grounded primarily or
uniquely in public institutions and organizations” (Perry & Wise, 1990, p. 368), has
been shown to be predictive of intentions to work in organizations that emphasize
service to the public (Christensen & Wright, 2011; Vandenabeele, 2008). While some
work on PSM has produced contradictory results, nevertheless employee PSM levels
have been directly or indirectly linked to job satisfaction, employee performance, as
well as reduced turnover intention (Bright, 2008; Naff & Crum, 1999). This research
also predicts a direct, negative relationship between a public employee’s PSM level
and intentions to leave his or her job.

Hypothesis 2: PSM is negatively related to turnover intention.

A number of studies have tested how PSM interacts with various contextual vari-
ables in the production of organizational outcomes (Coursey, Yang, & Pandey, 2012;
Stazyk, 2013; Im, Campbell, & Jeong, 2013). This study takes a similar approach and
argues that employees with high levels of PSM may be less likely than their low-PSM
coworkers to consider quitting their jobs in efficiency oriented organizations. A num-
ber of reasons are given to support this hypothesis.
First, at the heart of PSM theory is the idea that individuals with higher levels of
PSM are motivated by an altruistic desire to advance the cause of their fellow citizens
(Perry & Wise, 1990). While the underlying motivational assumptions of the NPM
literature are based on the rational choice, personal utility maximization model of

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264 Public Personnel Management 43(2)

human motivation (Lyons, Duxbury, & Higgins, 2006), high levels of PSM have been
shown to be related to a weaker concern with extrinsic rewards (Brewer, Selden, &
Facer, 2000; Bright, 2005). As such, if an organization’s emphasis on efficiency
increases the workload of a given employee relative to the payoff, the altruistic and
nonmaterialistic effects of PSM may act as a buffer to increased dissatisfaction. At the
same time, if high-level PSM employees believe that cost cutting measures are benefi-
cial to the public, they may be more willing to make personal sacrifices in their pursuit
compared with their more self-interested coworkers. This suggestion is also in line
with Naff and Crum’s (1999) finding that higher levels of PSM were related to greater
support for the National Performance Review among federal workers in the United
States.
An additional line of reasoning also suggests that PSM may moderate the relation-
ship between performance emphasis and turnover intention. P. G. Scott and Pandey
(2005) investigated a link between PSM levels and perception of red tape in public
organizations. Motivating their argument with attribution theory (Weiner, 1986), the
authors suggested that higher levels of PSM will increase the likelihood that employ-
ees will ascribe the perception of red tape to internal circumstances, seeing “rules as
legitimate and something over which they have some measure of control” (p. 164). On
the contrary, low-PSM employees may attribute the existence of red tape to external
circumstances, thus feeling powerless over it and alienated from their organizations.
This higher tolerance for red tape may also extend to increased efficiency emphasis in
public organizations. If high-level PSM employees see performance and cost cutting
measures as legitimate and to a certain extent under their control, they may be better
able to cope than employees with lower levels of PSM, thereby decreasing turnover
intention. If employees view the causes of increased pressure to perform at work as
entirely external to them, however, they may be more susceptible to its negative
effects. As such, PSM may reduce the effects of a strong emphasis on organizational
efficiency.

Hypothesis 3: PSM negatively moderates the relationship between efficiency

emphasis and turnover intention.

Organization Level Moderators: Procedural Justice and Innovation

Climate
While the individual level variable of PSM may mitigate the negative effects of effi-
ciency emphasis on turnover intention, a number of perceived organizational charac-
teristics may also influence this relationship by extending to employees greater control
over their circumstances in their organizations. First, procedural justice has long been
known to be a factor in employee intentions to leave their jobs in both private and
public organizations (Choi, 2011; Griffeth, Hom, & Gaertner, 2000; Rubin, 2007).
The perception of procedural justice is broadly understood to be a judgment about the
fairness with which organizational decisions are made, particularly those that affect
the well-being of the employee (Cohen-Charash & Spector, 2001; Rubin, 2007). The

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Campbell et al. 265

concept can also be understood as broadly related to the internal fairness dimension of
organizational performance discussed by Brewer and Selden (2000). Scholars have
pointed out that allowing employees the opportunity to raise their concerns about a
given change or decision that will potentially affect their lives within the organization
are particularly important for perceptions of fairness, and can affect organizational
trust, job satisfaction, as well as turnover intention (Rubin, 2007). However, such
access to the decision-making process may be especially important in organizations
with higher performance pressures or other stressful circumstances (Paterson & Cary,
2002). For example, H. S. Kim (2009) found a significant negative relationship
between informational justice and intentions to leave in the context of downsizing in
South Korea. From a social exchange perspective, if employees feel that they have
been treated unfairly without the opportunity to voice their concerns, they may feel
that the norm of reciprocity has been violated (Gouldner, 1960). In such cases, higher
turnover intentions have been shown to follow (Lavelle, Rupp, & Brockner, 2007).

Hypothesis 4: Perception of procedural justice is negatively related to turnover

intention.
Hypothesis 5: Perception of procedural justice negatively moderates the relation-
ship between efficiency emphasis and turnover intention.

This study also looks at the potential link between organizational climate for inno-
vation (S. G. Scott & Bruce, 1994) and employee turnover intention. Along with
increased performance, encouraging innovation in the public sector is a central tenant
of the Reinventing Government paradigm that has influenced public administration
theory and practice for the past decades (Frederickson, 2003; Osborne & Gaebler,
1992). Moreover, to the extent that encouraging employee innovation represents an
effective use of human capital, fostering an innovative organizational climate is theo-
retically linked to the internal effectiveness dimension of organizational performance
outlined by Brewer and Selden (2000). However, little work has been done to examine
the effects of innovation climate in government organizations on the behavior or atti-
tudes of public employees. Organizations with a strong innovation climate allow
employees the opportunity to influence work processes and respond to everyday chal-
lenges by utilizing their own creativity, and studies have linked innovation climate to
greater job satisfaction and organizational commitment (Im, Campbell, & Jeong,
2013; González-Romá et al., 2002). Insofar as innovation climate fosters as sense of
greater autonomy on the job, moreover, the construct may be linked to higher levels
intrinsic motivation (Park & Rainey, 2008), and thereby reduced turnover intention.

Hypothesis 6: Innovation climate is negatively related to turnover intention.

Innovation climate may play a more important role for turnover intentions in orga-
nizations that place a stronger emphasis on efficiency, however. For instance, organi-
zations that emphasize efficiency without giving employees the opportunity to improve
their work processes ultimately force employees to work faster rather than work

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266 Public Personnel Management 43(2)

smarter. Knudsen, Ducharme, and Roman (2009) argued that when managers lack the
autonomy to make flexible decisions, they may feel constrained in their roles and ulti-
mately face emotional exhaustion on the job, a phenomenon positively related to turn-
over intention (R. T. Lee & Ashforth, 1993). Given this relationship, it is reasonable
to suggest that as job demands increase, if employees are not able to adopt innovations
that ultimately improve productivity without increasing total effort, greater emotional
strain, and with it higher levels of turnover intention, will be the result.

Hypothesis 7: Innovation climate negatively moderates the relationship between

efficiency emphasis and turnover intention.

The South Korean Context

This study tests the above hypotheses using data gathered from local government
organizations in South Korea. Local government organizations in Korea have a num-
ber of characteristics that distinguish them from national government organizations, as
well as local government in other countries. Local autonomy in Korea was reinstated
in 1995 and, following the Devolution Promotion Act of 1999, many local govern-
ments, particularly those outside of major centers, have struggled to improve their
governing capacity and increase efficiency, with many remaining in a “fledgling state”
(Cho, Hong, & Wright, 2010, p. 381). Korea remains a relatively centralized country
in administrative terms, with roughly three quarters of administrative responsibility
handled by the central government, much lower than the United States at roughly
50%, or Japan with 34%. Moreover, most local governments remain largely dependent
on the central government for funding, which may lead to increased pressures to
reduce costs and improve productivity (Cho et al., 2010). As such, the extent to which
a given local government emphasizes efficiency in its operation may be in part a func-
tion of its relationship with the central government.
In relation to turnover, one significant feature of the civil service in Korea at both
the national and local level is the significant job protections for civil servants as pro-
scribed by the Civil Service Law. Unlike the United States, generally in Korea, a
strong distinction is made between public and private sector work, and entrance into
the public bureaucracy is almost entirely determined by high performance on tiered
competitive examinations (Im, Campbell, & Cha, 2013). Given this, turnover in the
public sector is generally low, though some government organizations, such as city
hospitals, have suffered from high levels of turnover (Hwang & Chang, 2009). On the
contrary, organizational and individual performance is highly scrutinized across the
bureaucracy, and particularly following the Asian financial crisis in the late 1990s,
civil servants are subject to relatively intense performance reviews and other results-
based human resource management practices, including performance-contingent pay
(P. S. Kim & Hong, 2013). Organization-level performance results are open to the
public, and as such government organizations often face public scrutiny related to their
internal efficiency and performance. Moreover, especially since 1997, NPM-orientated
reform efforts have been continuously pursued, with increasing effects of “reform
fatigue” among government employees (Im & Lee, 2011; Kim, 2000, p. 158).

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Campbell et al. 267

While the hypotheses tested in this study are theory-based, nevertheless, the unique
characteristics of Korean local government make it an interesting and relevant context
for empirical testing.

Method
Data
The Korean Local Civil Servant Survey (KLCSS) was designed by the Knowledge
Center for Public Policy at Seoul National University and was administered between
July 2 and July 27, 2012, by Gallup Korea. Employees surveyed worked in local gov-
ernment organizations from 16 administrative regions across Korea. Respondents
were selected randomly from predefined categories designed to ensure that the sample
broadly represented the population of local government employees according to age
group, sex, civil service grade, and job type (core administrative management vs. pol-
icy planning, implementation, or regulatory work). Surveys were administered with
the full support of organization heads, and, while not common, in the event that a
selected employee was unable to participate in the survey, another employee from the
same organization with comparable characteristics participated in their place. The sur-
veys were administered by face-to-face interviews, and in total 1,407 usable surveys
were collected. The questions used in this study were drawn from the larger question-
naire, which included 159 structured questions measured mostly on a 5-point Likert-
type scale (where 1 = strongly disagree and 5 = strongly agree). Respondents were
assured of the confidentiality of their responses.
Table 1 shows summary statistics for the individual-level characteristics of the
sample.

Measurements
The dependent variable in our study, turnover intention, was measured by a single
item: “I often think about quitting this job.” Answers ranged from 1 (strongly dis-
agree) to 5 (strongly agree). The dependent variable does not measure actual turnover,
but rather turnover intention. Obviously, in some instances, and perhaps a great many,
heightened intention to turnover may not result in an employee leaving his or her job.
However, turnover intention and actual turnover have been found to be highly corre-
lated measures in a number of previous studies (Dalton, Johnson, & Daily, 1999; Steel
& Ovalle, 1984; Vandenberg & Nelson, 1999; Cho & Lewis, 2012). Use of turnover
intention rather than actual turnover, moreover, is also consistent with the majority of
research on the subject (Moynihan & Pandey, 2008).
Public organizations that emphasize efficiency should show a continuous tendency
to both increase productivity and reduce costs. Efficiency emphasis was thus measured
using two questions: “Over the past 2 years, the productivity of our district office has
improved” and “Our district office makes an effort to cut costs.” Employees who per-
ceive that their organization emphasizes efficiency should thus report high values of

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268 Public Personnel Management 43(2)

Table 1.  Sample Characteristics.

Variable Values Frequency %

Service grade Entry level 1,055 74.98
  High level 352 25.02
Job type Administrative 827 58.78
  Nonadministrative 580 41.22
Tenure Less than 10 years 296 21.29
  10 to 19 years 341 24.53
  20 to 29 years 417 30
  More than 30 years 336 24.17
Sex Male 941 66.88
  Female 466 33.12
Age groups Below 30 38 2.71
  30s 321 22.88
  40s 540 38.49
  50s 502 35.78
  60s 2 0.14
Education High school or less 157 11.21
  College 167 11.93
  University 952 68
  Graduate school 124 8.86

agreement for both of these questions. Like the other variables in this study, these
items were measured on a 5-point Likert scale. Responses to the questions were aver-
aged, producing a scale ranging from 1 (low efficiency emphasis) to 5 (high efficiency
emphasis). Cronbach’s alpha for the combined questions was .749, indicating an
acceptable level of internal consistency.
PSM was measured by five questions based on Perry’s (1997) 24-item scale. The
questions were as follows: “I feel a strong responsibility for society”; “As a citizen,
serving other citizens is my duty”; “Serving the public is more meaningful than my
own self-interest”; “I am willing to help others even at significant cost to myself”; and
“My contribution to society is more important than my own accomplishments.”
Questions were averaged and a scale ranging from 1 to 5 was produced indicating low
to high levels of PSM. Cronbach’s alpha for the scale was .854.
Unlike emphasis on organizational efficiency, an organization’s climate for inno-
vation facilitates the “production or adoption of useful ideas and idea implementation”
by employees (S. G. Scott & Bruce, 1994, p. 581; Van de Ven, 1986). This study
measures innovation climate with four questions drawn from S. G. Scott and Bruce
(1994), who proposed a two-factor scale for the construct consisting of support for
innovation and resource supply. Three questions were drawn from the first factor:
“My organization’s leadership encourages creative solutions to problems,” “Members
at all levels are encouraged to contribute new ideas to improve the organization,” and
“My organization is open and responsive to change.” From the resource supply factor,

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Campbell et al. 269

we included the question, “Resources are available to implement new initiatives.”

Because the initial scale included multiple factors, an exploratory factor analysis using
varimax rotation was conducted on the four items to discover whether this macro
structure was maintained in the subset of questions. All four items loaded onto a single
factor, and as such, for the purposes of this study, it is possible to assume unidimen-
sionality of the scale. Responses were averaged and the resultant scale ranges from 1
(weak innovation climate) to 5 (strong innovation climate). Cronbach’s alpha for the
scale was .867.
Thibaut and Walker (1975) argued that perception of procedural justice is based on
the extent to which an individual has access to important decision-making processes
and second on the perceived ability to exert influence on decisions that affect his or her
well-being. As such, voice is understood to be a critical element of procedural justice
(Colquitt, 2001; Thibaut & Walker, 1975). This study measures procedural justice
using three items: “Employees are involved in decisions that affect them,” “Employees
are involved in important changes,” and “Information is well shared among members
of this organization.” The first two items are similar to those proposed by Thibaut and
Walker (1975), while the third question is included based on the idea that access to
information is a critical factor enabling meaningful participation in decisions related
to organizational life. Items were summed to create a scale ranging from 1 to 5 with
higher values representing higher levels of perceived procedural justice. Cronbach’s
alpha for the scale was .872.
In addition to perceptions of procedural justice, this study also controls for percep-
tions of distributive justice in the form of merit-based promotions. Adams (1963), in
articulating expectancy theory in the organizational context, argued that employees
who exert effort in the workplace do so with the expectation that their work will be
recognized and rewarded in a fair manner. More precisely, workers make comparisons
between their own perceived ratio of reward outcomes to perceived inputs to the ratios
of others similarly situated within the organization. If these ratios are not roughly
comparable, employees may perceive a lack of fairness, and greater intentions to leave
the organization are likely to result (Alexander & Ruderman, 1987; Choi, 2011). We
measure distributive justice with the question “Promotion depends on employee per-
formance,” which measures the extent to which an important organizational reward is
distributed on a nonarbitrary basis by taking into account the individual efforts of
employees. We focus on promotion rather than wage as in Korean public organiza-
tions wage continues to be closely tied to job grade and tenure (Kwon, 2012), and
moreover as promotion represents the most critical extrinsic motivator in this context
(Im, Campbell, & Cha, 2013).

Summary Statistics
Table 2 shows summary statistics for the variables in this study. Turnover intention
was measured on a 5-point scale and has a mean value of 2.5. The distribution of
answers is skewed slightly toward the lower end of the scale, meaning that in general
employees of the Korean central government are not overly eager to leave their jobs.

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270 Public Personnel Management 43(2)

Table 2.  Summary Statistics.

Variable M SD Minimum Maximum

Turnover intention 2.50 1.03 1 5
Efficiency emphasis (EE) 4.03 0.64 1 5
Public Service Motivation (PSM) 3.56 0.59 1.2 5
Procedural justice (PJ) 3.44 0.67 1 5
Innovation climate (IC) 3.46 0.66 1 5
Merit-based promotions 3.03 0.86 1 5
Service grade 3.65 1.09 1 6
Nonadministrative staff 0.41 0.49 0 1
Tenure 20.12 9.94 0.08 39
Gender (male = 1) 0.67 0.47 0 1
Age 44.96 8.40 21 60
Education 2.75 0.77 1 4

Emphasis on efficiency shows a mean value of 4.03 and a standard deviation of 1.03.
Especially since the late 1990s, the Korean government has introduced a number of
reforms focusing on increasing the efficiency and performance of public organizations
(Jung, 2006, cited in C. Lee & Moon, 2010). However, most of these reforms have
targeted the central government ministries, and reforms at the local level have focused
on the devolution of powers to local bodies especially since the implementation of the
Devolution Promotion Act of 1999. Despite the alleged “weak self-governing compe-
tency” of local government and significant fiscal imbalances between central and local
governments (Cho et al., 2010, p. 382), our sample shows that local government orga-
nizations are relatively efficiency orientated in their operations. Encouragingly, our
sample also shows higher than midpoint mean values for innovation climate and pro-
cedural justice.
The mean value of PSM is 3.56, which indicates the sample population of this study
has a generally prosocial orientation. Both theory and empirical research suggests that
those with high levels of PSM may self-select into public sector jobs (Christensen &
Wright, 2011; Vandenabeele, 2008), and a higher than midpoint average is consistent
with this idea.
Statistical tests indicated that multicollinearity was not a problem among the main
variables used in this study. Except for age (9.54), tenure (8.31) and service grade
(3.34), no single variable returned a variance inflation factor higher than 1.87, which
is well below the conventional 10.0 cutoff, indicating that steps to reduce the problems
associated with multicollinearity were not necessary in this case.1

Analysis Results
Bivariate Correlations
Table 3 shows bivariate correlations between the independent, dependent, and control
variables. Hypotheses related to the effects of PSM, procedural justice, and innovation

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Campbell et al. 271

Table 3.  Bivariate Correlations.

1 2 3 4 5
1.  Turnover intention  
2.  Efficiency emphasis (EE) −.08**  
3.  Public Service Motivation (PSM) −.22*** .33***  
4.  Procedural justice (PJ) −.21*** .34*** .37***  
5.  Innovation climate (IC) −.26*** .40*** .50*** .56***  
6.  Merit-based promotions −.17*** .22*** .21*** .33*** .38***
**p < .01. ***p < .001, significance test two-tailed.

on turnover intention are all in the expected directions. Merit-based promotions are
also negatively correlated with turnover intention.
Hypothesis 1 of this study stated that efficiency emphasis is positively related to
turnover intention; however, this hypothesis was not supported at the bivariate level.
While there is a statistically significant relationship (p < .05), the sign is negative
rather than positive. However, while bivariate correlations can act as a useful heuristic
in understanding trends across data, correlations do not control for the effects of other
factors influencing the dependent variable. In this case, important information is lost,
and problems such as omitted variable bias and an increased likelihood of spurious
significant findings become problems (Hox, 1995). As such, in the next section, we
present a series of regression models to mitigate these problems and provide a more
accurate picture of the relationship between the independent and dependent
variables.

Analysis Results
To control for heterogeneous effects resulting from unobserved differences between
organizations located in different regions, we regressed the independent variables on
turnover intention using both fixed and random effects estimators. The results of the
regressions are reported in Table 4 in columns 1 and 2. The coefficients of the two
analyses were not qualitatively different, though a significant Hausman test indicated
that the fixed effect estimator was superior (Greene, 2012, p. 277; Hausman, 1978;
Wooldridge, 2009). We also tested our model using an ordered logit estimator (results
available in the appendix) to see whether the results are robust to the alternative
assumption that the dependent variable is ordinal rather than continuous. Coefficients
for the ordered logit model were again not qualitatively different from the fixed effects
model. Three models shown in columns 3 to 5 of Table 4 test the interaction hypoth-
eses of the study using a fixed effects estimator.
Results displayed in the table indicate that efficiency emphasis is positively related
to turnover intention at a p < .05 significance level, which is in line with Hypothesis 1.
We also hypothesized that PSM would be negatively related to turnover intention
(Hypothesis 2), and again the results bear this out with a negative and statistically sig-
nificant (p < .05) coefficient. Results for both perceived levels of procedural justice and

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 272
Table 4.  Analysis Results.

1 2 3 4 5
Efficiency emphasis (EE) .099* (.047) .100* (.047) .568** (.214) .634*** (.192) .658*** (.192)
Public Service Motivation (PSM) −.134* (.056) −.145** (.055) .417† (.252) −.127* (.055) −.129* (.055)
Procedural justice (PJ) −.136** (.049) −.133** (.049) −.132** (.049) .532* (.237) −.134** (.049)
Innovation climate (IC) −.231*** (.056) −.231*** (.056) −.226*** (.056) −.230*** (.056) .454† (.235)
Merit-based promotions −.065† (.035) −.072* (.035) −.063† (.035) −.062† (.035) −.060† (.035)
Service grade .018 (.044) .016 (.044) .016 (.044) .016 (.044) .017 (.044)
Nonadministrative staff .006 (.056) .005 (.056) .011 (.056) .006 (.056) .008 (.056)
Tenure −.008 (.008) −.008 (.008) −.008 (.008) −.007 (.008) −.008 (.008)
Gender (male = 1) −.139* (.069) −.129† (.069) −.145* (.069) −.146* (.069) −.142* (.069)
Age .004 (.010) .004 (.010) .005 (.010) .004 (.010) .004 (.010)
Education −.018 (.037) −.018 (.037) −.023 (.037) −.017 (.037) −.019 (.037)
EE × PSM −.136* (.061)  
EE × PJ −.162** (.056)  
EE × IC −.168** (.056)
Constant 4.087*** (.350) 4.151*** (.346) 2.175* (.921) 1.887* (.841) 1.783* (.843)

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R2 .084 .090 .088 .090 .090
Region effects Fixed Random Fixed Fixed Fixed
n 1,376 1,376 1,376 1,376 1,376

Note. Standard errors are in parentheses.

†p < .10. * p < .05. **p < .01. ***p < .001.
Campbell et al. 273

innovation climate are also negatively related to turnover intention at statistically sig-
nificant levels (p < .01 and p < .001, respectively), which is in line with Hypotheses 4
and 6. Finally, we controlled for merit-based promotion on the assumption that fair and
performance-based promotions would lessen turnover intentions. This variable has a
negative coefficient, though the relationship is not significant at the p < .05 level. The
next section assesses the moderation effects of PSM, procedural justice, and innovation
climate on the relationship between efficiency emphasis and turnover intention.

Individual and Organizational Level Moderators

This study hypothesized that PSM, perception of procedural justice, and innovation
climate would negatively moderate the effects of efficiency emphasis on turnover
intention. Columns 3 through 5 of Table 4 show the results of fixed effects analyses
testing these hypotheses. Models in these columns each contain a product term built
from efficiency emphasis and the relevant moderator (Aiken & West, 1991; Cohen &
Cohen, 1983). All three moderators show statistically significant, negative coeffi-
cients, offering empirical support for Hypotheses 3, 5, and 7. In other words, PSM,
procedural justice, and innovation climate appear to negatively moderate the relation-
ship between efficiency emphasis and turnover intention.
To aid the interpretation of the moderation results, a series of graphs were created
following the methods described by Aiken and West (1991) (Figure 1). Each of the
three moderator variables was divided into low and high groups at 1 standard devia-
tion below and above the mean, respectively. The graphs show the predictive margins
of efficiency emphasis on turnover intention at these levels.
The three graphs indicate that for low levels of PSM, procedural justice, and inno-
vation climate, the relationship between efficiency emphasis and turnover intention is
positive (all slopes significant at p < .01). However, at high levels of each respective
moderator, slope coefficients are close to zero and not significant. At the individual
level, these results suggest that efficiency emphasis only raises the turnover intention
of employees who have low levels of PSM, while high level PSM employees are
shielded from its effects. Secondly, the results suggest that employees who perceive
that their organization allows them access to important decision-making processes or
the chance to be innovative are not adversely affected by their organization’s emphasis
on efficiency. These results are largely in line with the hypotheses of this study.

Discussion
Efficiency Emphasis and Turnover Intention
Citizens in democratic countries have increasingly made their voice clear that govern-
ment should not be exempt from the standards of efficiency that arise through competi-
tive pressures in the private sector. A responsive, high performance government has
increasingly become a political as well as a financial necessity. The performance turn
in public administration theory and practice has had a major impact on how public
services are conceived, produced, and delivered. However, the results of this study

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274 Public Personnel Management 43(2)

Figure 1.  Interaction effects of PSM, PJ, and IC.

Note. PSM = Public Service Motivation; PJ = procedural justice; IC = innovation climate.

suggest that caution should be exercised in placing a strong emphasis on efficiency to

avoid unintended consequences related to the human resources of public organizations.
This study suggested that efficiency emphasis may be associated with burnout and
exhaustion among employees, which have been shown to be important factors in turn-
over (Kim, 2005; Samantrai, 1992). At the same time, emphasizing efficiency may be
perceived as undermining the distinctive values of public organizations (R. B. Denhardt
& Denhardt, 2000; Hood, 1991). It should be noted, however, that these underlying
mechanisms linking efficiency emphasis to turnover intention were not tested directly
in this study, and as such their validity is subject to verification in future studies.
This study used a sample of local government civil servants in South Korea, a coun-
try strongly influenced by NPM doctrines (P. S. Kim & Hong, 2013). However, the
majority of public administration scholarship on turnover intention in the public sector
has focused on the employees of Western governments, particularly those in the

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Campbell et al. 275

United States. In Korea, many local governments are dependent on the central govern-
ment and, as such, budgetary and performance pressure may be forces acting on local
governments from the outside. Despite the theoretical grounding of our argument link-
ing efficiency emphasis and turnover intention, nevertheless, this particular feature of
the Korean context may act to amplify the effects uncovered this study. This remark
suggests the relationship between efficiency emphasis and employee well-being
should be validated in other organizational contexts in future studies.

The Moderating Effect of PSM

This study also found that PSM can decrease the effects of a strong emphasis on effi-
ciency on local government employees’ the intentions to leave their jobs. This result
has interesting theoretical and practical implications. First of all, previous research has
found that PSM may have a similar buffering effect on other dimensions of organiza-
tional life (Kwon, 2012; P. G. Scott & Pandey, 2005). P. G. Scott and Pandey (2005)
argued that this is the result of employees with higher levels of PSM making an inter-
nal attribution to circumstances that frustrate their ability to meet their own goals. If
this internal attribution results in less job stress or feelings of burnout when faced with
these circumstances, then attribution theory is also applicable as an explanation for the
moderating effects of PSM in the present study.
An alternative theoretical explanation relates to the tendency of higher level PSM
employees to be willing to sacrifice themselves for a greater cause. Self-sacrifice is
understood to be a central dimension of PSM (Perry, 1996). Based on the job demands–
resources model, if greater performance pressure is applied in organizations, employees
may face reduced resources relative to demands. This condition may affect all employ-
ees equally in their physical circumstances, but higher level PSM employees may be
more inclined to sacrifice their own self-interest for organizational goals, particularly if
they understand these goals to be in line with their service-orientated values.
From a practical perspective, while there are costs associated with employee turn-
over, on the contrary, turnover can be healthy when those with weak performance
leave their jobs. Given this, and insofar as increasing performance in government
organizations is both desirable and necessary, the results of this study represent good
news for public organizations. A number of studies have provided evidence that high-
level PSM employees are more likely to be satisfied in their jobs, show higher levels
of organizational commitment, and be high performers overall (Crewson, 1997; Naff
& Crum, 1999). These employees are valuable from the perspective of public organi-
zations. As such, that the nearly ubiquitous efficiency emphasis in public organiza-
tions may affect these employees least, while increasing the likelihood that lower
performance employees leave, may be evidence that performance enhancing measures
in public organizations are perhaps having a desirable effect after all.

Procedural Justice and Innovation Climate

The moderating effects of both procedural justice and innovation climate on the rela-
tionship between efficiency emphasis and turnover intention have rich practical

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276 Public Personnel Management 43(2)

implications for public managers. As public organizations confront the imperative to

do more with less, appropriate human resource strategies are necessary to lessen the
potentially negative impact on civil servants. Involving employees in important deci-
sions that affect their work life and well-being has been linked to a number of positive
dispositions among employees (Rubin, 2007). However, this study shows that in the
context of an increased emphasis on efficiency, an inclusive managerial orientation
can enhance acceptance of change. This finding is in line with a number of studies
focusing on various change-related processes in the private sector literature (Cobb,
Wooten, & Folger, 1995; Greenberg, 1990; Paterson & Cary, 2002).
Doing more with less and creating a more innovative public sector are notions at
the heart of reinventing government-style reforms (Gore, 1993; Osborne & Gaebler,
1992). Our study highlights the importance of managerial support for creativity and
innovation in public organizations in the context of an increased emphasis on effi-
ciency. Since the early work of Schumpeter (1934), innovation and increased produc-
tivity have been inseparable concepts. However, this article contributes to the
discussion by highlighting the importance of support for innovation on employee as
opposed to organizational well-being. Employees who face increasing performance
demands in contexts with little support for innovation will have little choice but to
work harder, which may lead to burnout and increased job stress. Managerial support
for innovation can lessen the impact of increased job demands by extending to employ-
ees the license to improve their work processes and share ideas.

Conclusion
This study found that a high emphasis on efficiency in local government organizations
in South Korea was associated with greater turnover intention. It was also found that
employee levels of PSM, procedural justice, and innovation climate potentially lessen
the strength of this relationship. From a pubic management point of view, our study
implies that if increasing performance demands are not implemented in such a way
that employees are able to voice their concerns or are not empowered to respond to
increased demands creatively and improve work processes, higher turnover intentions
may result. Second, the turnover-related effects of emphasizing organizational effi-
ciency were found to be less strong for employees with high levels of PSM. As such,
given that PSM has been found to be related to on the job performance and other posi-
tive behaviors, it may be the case that an emphasis on organizational efficiency results
in increased turnover of the least motivated employees, thereby increasing overall
organizational performance.
Efficiency-orientated reforms may indeed have a positive impact on public orga-
nizations by encouraging lower performers to seek work elsewhere. At the same time,
however, the principle findings of this study, that a strong emphasis on efficiency is
associated with increased turnover intention, suggests that some level of restraint is
necessary in pushing for efficiency in public organizations. Otherwise, a small sav-
ings in the financial resources of the organization may result in a costly loss of the
human kind.

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Campbell et al. 277

Appendix
Ordered Logistic Analysis
1 2 3 4

Efficiency emphasis (EE) .174* (.088) 1.293** (.408) .550** (.194) 1.212*** (.368)
Public Service −.385*** (.107) .924† (.478) −.376*** (.107) −.368*** (.107)
Motivation (PSM)
Procedural justice −.241** (.087) −.238** (.087) .143 (.197) −.231** (.087)
Innovation climate (IC) −.414*** (.107) −.393*** (.108) −.378*** (.108) .849† (.448)
Merit-based promotions −.130* (.065) −.131* (.065) −.125† (.065) −.132* (.065)
Service grade .040 (.080) .037 (.081) .036 (.080) .039 (.081)
Nonadministrative −.023 (.103) −.015 (.103) −.013 (.103) −.018 (.103)
Tenure −.020 (.014) −.019 (.014) −.018 (.014) −.018 (.014)
Gender (male = 1) −.237† (.125) −.246* (.125) −.240† (.125) −.239†(.125)
Age .013 (.017) .013 (.018) .012 (.017) .013 (.017)
Education −.028 (.068) −.039 (.068) −.029 (.068) −.028 (.068)
EE × PSM −.326** (.116)  
EE × PJ −.111* (.051)  
EE × IC −.313** (.108)
Cut 1 −4.790 (.630) −.286 (1.714) −3.379 (.903) −.550 (1.583)
Cut 2 −3.143 (.622) 1.371 (1.715) −1.727 (.899) 1.105 (1.583)
Cut 3 −1.630 (.619) 2.884 (1.715) −.213 (.898) 2.618 (1.582)
Cut 3 .880 (.644) 5.396 (1.726) 2.300 (.917) 5.135 (1.596)
Likelihood-ratio χ2 136.99 144.69 141.7 145.38
Cox–Snell R2 .095 .100 .098 .100

Note. n = 1,376 for all models.

†p< .10. *p < .05. **p < .01. ***p < .001.

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship,
and/or publication of this article.

Funding
The author(s) disclosed receipt of the following financial support for the research, authorship,
and/or publication of this article: This study was partially funded by a grant from the Korea
Research Foundation (NRF-2011-330-B00195 [I00035]).

Note
1. Due to the levels of multicollinearity between time-based variables, however, alternative
models which omitted age and organizational tenure, respectively, were also tested, and the
results showed no qualitative differences.

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Author Biographies
Jesse W. Campbell (jessewcampbell@gmail.com) is currently an assistant professor in the
College of Public Service at Chung-Ang University in Seoul, South Korea. His research focuses
on exploring the cognitive and affective foundations of employee behavior in public organiza-
tions, as well as broader issues uniquely relevant to the East Asian administrative context.
Tobin Im (tobin@snu.ac.kr) is a professor in the Graduate School of Public Administration at
Seoul National University, South Korea. He has published extensively in international journals
as well as written more than 20 books in the field of organization theory, comparative public
administration, and performance management. His current research focuses on developing the
theory of Government Competitiveness and defining its indicators from a temporal
perspective.
Jisu Jeong (jsjeong@snu.ac.kr) is a PhD Student in the Graduate School of Public Administration
at Seoul National University. He is currently working on the topic of government competitive-
ness. His research interests include public management, HRM, organizational behavior, and
comparative public administration.

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