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

E-governance, Accountability, and Leakage in Public Programs: Experimental Evidence from a... AbstractCan e-governance reforms improve government policy? By making information available on a real-time basis, information technologies may reduce the theft of public funds. We analyze a large field experiment and the nationwide scale-up of a reform to India’s workfare program. Advance payments were replaced by “ just-in-time” payments, triggered by e-invoicing, making it easier to detect misreporting. Leakages went down: program expenditures dropped by 24 percent, while employment slightly increased; there were fewer fake households in the official database; and program officials’ personal wealth fell by 10 percent. However, payment delays increased. The nationwide scale-up resulted in a persistent 19 percent reduction in program expenditure. (JEL C93, D72, I38, O15, O17) http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png American Economic Journal Applied Economics American Economic Association

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

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Publisher
American Economic Association
Copyright
Copyright © 2020 © American Economic Association
ISSN
1945-7790
DOI
10.1257/app.20180302
Publisher site
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Abstract

AbstractCan e-governance reforms improve government policy? By making information available on a real-time basis, information technologies may reduce the theft of public funds. We analyze a large field experiment and the nationwide scale-up of a reform to India’s workfare program. Advance payments were replaced by “ just-in-time” payments, triggered by e-invoicing, making it easier to detect misreporting. Leakages went down: program expenditures dropped by 24 percent, while employment slightly increased; there were fewer fake households in the official database; and program officials’ personal wealth fell by 10 percent. However, payment delays increased. The nationwide scale-up resulted in a persistent 19 percent reduction in program expenditure. (JEL C93, D72, I38, O15, O17)

Journal

American Economic Journal Applied Economics – American Economic Association

Published: Oct 1, 2020

References