Optimal turnover rates and performance in public organizations: theoretical expectations

This paper advances the theory of turnover and performance in public organizations, incorporating labor market conditions and quality of labor. In doing so, we first present theories on optimal turnover rates, based on a cost-benefit theoretical framework. We then discuss how optimal turnover rates in public organizations change according to labor supply and demand. After that, we illustrate how public labor market conditions and quality of labor affect turnover-performance relationship. Throughout the paper, we propose a set of testable propositions for future scholars, which posit the turnover-performance relationships being conditioned on various organizational and environmental contextual factors