Discussion paper

DP11761 E-governance, Accountability, and Leakage in Public Programs: Experimental Evidence from a Financial Management Reform in India

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.

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Citation

Duflo, E, A Banerjee, C Imbert and R Pande (2017), ‘DP11761 E-governance, Accountability, and Leakage in Public Programs: Experimental Evidence from a Financial Management Reform in India ‘, CEPR Discussion Paper No. 11761. CEPR Press, Paris & London. https://cepr.org/publications/dp11761