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Spillovers in State Capacity Building: Evidence from the Digitization of Land Records in Pakistan

Author

Listed:
  • Shan Aman-Rana
  • Clement Minaudier

Abstract

Digitization reforms have been hailed as an effective way of strengthening state capacity. However, digitization can also fundamentally reshape the organization of bureaucracies. Using a unique administrative dataset on agricultural taxation and surveys of local bureaucrats from Punjab, Pakistan, we show that digitization reforms can have unintended consequences for state capacity. We exploit the staggered rollout of the digitization of land records in Punjab to show that digitization had a negative effect on tax collection. The fall in taxes was not due to a decrease in the tax base. Instead, digitization affected the bureaucrats' capacity to collect taxes.

Suggested Citation

  • Shan Aman-Rana & Clement Minaudier, 2026. "Spillovers in State Capacity Building: Evidence from the Digitization of Land Records in Pakistan," American Economic Review, American Economic Association, vol. 116(4), pages 1459-1498, April.
    • Handle: RePEc:aea:aecrev:v:116:y:2026:i:4:p:1459-98
    DOI: 10.1257/aer.20240880
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    More about this item

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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