Fraud Detection Under Limited State Capacity: Experimental Evidence From Senegal

Last registered on August 04, 2025
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Pre-Trial

Trial Information

General Information

Title
Fraud Detection Under Limited State Capacity: Experimental Evidence From Senegal
RCT ID
AEARCTR-0016464
Initial registration date
July 28, 2025

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
August 04, 2025, 5:59 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country
Senegal
Region
Africa

Primary Investigator

Name
Léo Czajka
Affiliation
Paris School of Economics
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Other Primary Investigator(s)

PI Name
Bassirou Sarr
PI Affiliation
Ministère des Finances et du Budget, République du Sénégal
Contact Investigator
PI Name
Mattea Stein
PI Affiliation
University of Naples Federico II and Centre for Studies in Economics and Finance
Contact Investigator

Additional Trial Information

Status
Completed
Start date
2020-09-01
End date
2023-11-15
Keywords
Behavior, Firms & Productivity, Governance
Additional Keywords
tax enforcement
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Most economic actors -- incorporated firms, self-employed and employees -- in low-income countries are not tax registered and among those registered, non-compliance (under-reporting and failure to declare) is common. Obtaining reliable information on the existence and scope of their economic activities poses complex challenges to tax administrations operating with very limited resources. This study explores how deterring misreporting of third-party data by the largest firms can efficiently help administration to detect tax evasion.
External Link(s)

Registration Citation

Citation
Czajka, Léo, Bassirou Sarr and Mattea Stein. 2025. "Fraud Detection Under Limited State Capacity: Experimental Evidence From Senegal." AEA RCT Registry. August 04. https://doi.org/10.1257/rct.16464-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
By law, tax registered firms in Senegal are required submit to the tax administration the list of all their service suppliers each year in January of year t+1. These lists must include, for each supplier, the name, numerical ID, address, total amount paid and tax withheld (if applicable). We collect all such lists submitted by the large and medium-sized firms in Senegal since 2018. Analyzing the baseline data, we document widespread mis-reporting of identification information: 9 out of 10 firms omit the ID of at least one of its supplier. We then collaborate with the large and medium taxpayers units to implement a wide-reaching enforcement campaign aimed at deterring future misreporting. We then use administrative data submitted after the launch of the enforcement campaign to measure the impact of the intervention.
Intervention (Hidden)
Intervention Start Date
2021-01-12
Intervention End Date
2022-12-31

Primary Outcomes

Primary Outcomes (end points)
probability to misreport follow-up suppliers list
share of misreported suppliers (i.e with some information missing)
share of suppliers flagged as tax evaders
Primary Outcomes (explanation)
conditional on being reported (by their clients) with some numerical ID, suppliers will be classified as tax evaders is they are not tax registered or if they are tax registered but their self-declared revenue are strictly lower than the sum of payments declared by their clients.

Secondary Outcomes

Secondary Outcomes (end points)
probability to misreport other type of declaration (as a sign of general improvement of declarative compliance)
probability to remit the 5% tax to be withheld from transactions to non tax registered suppliers
total amount remitted to the tax administration

impact on suppliers themselves:
probability to declare
total revenue declared (because better third-party reporting by the client could deter suppliers from under-reporting)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Our experimental sample consists of all 3,489 firms that have mis-reported supplier lists at least once according the 2018-2020 baseline data. This sample is then split across two groups: one treatment group targeted by the enforcement campaign, and one control group that receives nothing from the experiment.

The enforcement campaign lasts one full year and consists in individualized messages (3 emails in January, May-June, and December 2022 + follow-up verification phone calls after each email). The messages a) indicate that past-misreporting has been detected, b) remind that mis-reporting of lists of suppliers is subject to sanctions and c) urge to do better in the future.

Individualized emails are sent using mail-merge technology, via the communication channels usually used by the tax administration. Phone calls are done by the staff of the communication department of the tax administration.

Taxpayers are not aware of being part of any experiment.
Experimental Design Details
Randomization Method
Randomization across treatment and control group was done with the Stata randtreat using 3 strata variable for a total of 32 stratas (STATA version 16.1). The seed number we used was : 973437
Randomization Unit
firms only
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
3,489 firms
Sample size: planned number of observations
3,489 firms
Sample size (or number of clusters) by treatment arms
1743 in the treatment group, 1746 in the control group
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number
Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials