Rohini Pande (Alesina Seminar)

Today's Speaker

Rohini Pande (Yale), "Can Reducing Information Frictions Strengthen State Capacity? Experimental Evidence from a Very Large Public Works Program" (w/ Eric Dodge, Yusuf Neggers and Charity Troyer Moore)

Abstract

In low state capacity environments, improved information flows can directly improve program implementation by bureaucrats with heavy workloads. However, if incentives across the administrative hierarchy are misaligned, implementation improvements are contingent on who receives the information. To examine whether and why easier information access affects the quality of program implementation, we collaborated with two Indian states to randomize which bureaucrats received access to “PayDash”, a digital platform that made it easier to track and process payments for workers in India’s rural workfare program. Social protection strengthened in districts with PayDash access: Worker payment processing times fell by 24% and days worked by participating households increased by 9%. Consistent with effort costs, rather than managerial rent-seeking, constraining implementation in understaffed bureaucracies, PayDash has similar impacts whether randomly assigned to principals or managers, with no additional gains when given to both. Finally, indicative of better information lowering reliance on blunt incentive contracts, PayDash for principals reduced manager posting transfers by 20%. Increased work days and reduced wage payment delays accruing through PayDash provision strengthened state capacity, benefiting rural Indians at a rate roughly fifty times that of costs.
 

Co-sponsored by FAS and IQSS, the Alberto Alesina Seminar on Political Economy supports research-related activities that integrate the study of economics and politics, whether by studying economic behavior in the political process or political behavior in the marketplace. In general, positive political economy is concerned with showing how observed differences among institutions affect political and economic outcomes in various social, economic, and political systems and how the institutions themselves change and develop in response to individual and collective beliefs, preferences, and strategies.

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