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E-Governance, Accountability, and Leakage in Public Programs: Experimental Evidence from a Financial Management Reform in India

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Listed:
  • Banerjee, Abhijit

    (MIT)

  • Duflo, Esther

    (MIT)

  • Imbert, Clement

    (U Warwick)

  • Mathew, Santosh

    (Indian Ministry of Rural Development)

  • Pande, Rohini

    (Harvard University)

Abstract

In collaboration with the Government of Bihar, India, we conducted a large-scale experiment to evaluate whether transparency in fiscal transfer systems can increase accountability and reduce corruption in the implementation of a workfare program. The reforms introduced electronic fund-flow, cut out administrative tiers, and switched the basis of transfer amounts from forecasts to documented expenditures. Treatment reduced leakages along three measures: expenditures and hours claimed dropped while an independent household survey found no impact on actual employment and wages received; a matching exercise reveals a reduction in fake households on payrolls; and local program officials' self-reported median personal assets fell.

Suggested Citation

  • Banerjee, Abhijit & Duflo, Esther & Imbert, Clement & Mathew, Santosh & Pande, Rohini, 2016. "E-Governance, Accountability, and Leakage in Public Programs: Experimental Evidence from a Financial Management Reform in India," Working Paper Series rwp16-056, Harvard University, John F. Kennedy School of Government.
  • Handle: RePEc:ecl:harjfk:rwp16-056
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    References listed on IDEAS

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    1. Paul Niehaus & Sandip Sukhtankar, 2013. "Corruption Dynamics: The Golden Goose Effect," American Economic Journal: Economic Policy, American Economic Association, vol. 5(4), pages 230-269, November.
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    4. Banerjee, A.V., 1997. "A Theory of Misgovernance," Working papers 97-4, Massachusetts Institute of Technology (MIT), Department of Economics.
    5. Puja Dutta & Rinku Murgai & Martin Ravallion & Dominique van de Walle, 2014. "Right to Work? Assessing India's Employment Guarantee Scheme in Bihar," World Bank Publications, The World Bank, number 17195.
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    11. Benjamin A. Olken & Patrick Barron, 2009. "The Simple Economics of Extortion: Evidence from Trucking in Aceh," Journal of Political Economy, University of Chicago Press, vol. 117(3), pages 417-452, June.
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    Cited by:

    1. Abhijit Banerjee & Rukmini Banerji & James Berry & Esther Duflo & Harini Kannan & Shobhini Mukerji & Marc Shotland & Michael Walton, 2017. "From Proof of Concept to Scalable Policies: Challenges and Solutions, with an Application," Journal of Economic Perspectives, American Economic Association, vol. 31(4), pages 73-102, Fall.
    2. repec:eee:wdevel:v:103:y:2018:i:c:p:284-296 is not listed on IDEAS
    3. repec:aea:aecrev:v:107:y:2017:i:5:p:1-26 is not listed on IDEAS
    4. Cristina Corduneanu-Huci & Michael T. Dorsch & Paul Maarek, 2017. "Learning to constrain: Political competition and randomized controlled trials in development," THEMA Working Papers 2017-24, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    5. Kanbur, Ravi, 2017. "The Digital Revolution and Targeting Public Expenditure for Poverty Reduction," CEPR Discussion Papers 12089, C.E.P.R. Discussion Papers.

    More about this item

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy

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