Guardians of accountability: A field experiment on corruption and inefficiency in local public works

Corruption affects the building of public infrastructure across Peru’s districts. According to news sources, funds that were earmarked for a bridge connecting Quiñota and Colquemarca were misallocated. In the municipality of Zaña, which is located in the northern highlands, the materials to build a sanitation plant were purchased at inflated prices. In Chucuito, a £300,000 laboratory was abandoned long before its completion—and, at the start of 2015, the country’s Office of the Comptroller General found another 339 projects in a similar state. These stalled projects represent a significant financial loss and risk undermining progress in key areas, such as education, transportation, and sanitation. Thus, in light of these risks and building on previous research, I am executing a randomised control trial (RCT) on anti-corruption monitoring.

The study builds on four core assumptions:

• Corruption vulnerabilities exist where officials enjoy discretion over a government activity.
• Official discretion can be reduced (or directed toward socially desirable ends) through effective monitoring.
• Citizens do not have the time or the expertise required to properly monitor their government.
• Because anti-corruption agencies face vast areas of responsibility and have but limited resources at their disposal, they are restricted in what they can monitor.

With these concerns in mind, I plan to test the extent to which an anti-corruption NGO, if armed with relevant information and supported by authorities with sanctioning capacity, can serve as the public’s delegate of accountability—or, viewed from a different angle, as an anti-corruption agency’s partner in accountability promotion.

Based on the RCT’s design, half of the urban and peri-urban governments in the sample will receive a targeted letter from the collaborating NGO warning that the progress of a set of public works under their charge will be closely monitored. These governments will also receive a letter from the Office of the Comptroller General noting that the anti-corruption agency is aware of the NGOs monitoring efforts. The other half of urban and peri-urban governments in the sample will serve as control.

Letters are expected to have a disciplinary effect on bureaucrats’ behaviour. If this expectation is met, then the RCT will result in the following outcomes:

• A number of local governments in Peru will preserve a quantifiable amount of public funding that would have been lost to corruption.
• The Office of the Comptroller General will obtain specific policy recommendations on how it can enhance its anti-corruption strategy, and it will also obtain reliable metrics on which districts are most vulnerable to corruption.
• Anti-corruption watchdogs will obtain reliable metrics on the extent to which some of their current efforts impact government officials’ behavior; and
• The academic community will benefit from the results of a randomised control trial that tests theories on corruption monitoring.