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Rent extraction opportunities and self-selection into the public sector. Evidence from the Lab
Last registered on February 12, 2019

Pre-Trial

Trial Information
General Information
Title
Rent extraction opportunities and self-selection into the public sector. Evidence from the Lab
RCT ID
AEARCTR-0003877
Initial registration date
February 12, 2019
Last updated
February 12, 2019 4:58 PM EST
Location(s)
Region
Primary Investigator
Affiliation
CAF Development Bank of Latin America
Other Primary Investigator(s)
PI Affiliation
Universidad del Rosario
PI Affiliation
CAF Development Bank of Latin America
PI Affiliation
CAF Development Bank of Latin America
Additional Trial Information
Status
On going
Start date
2019-02-08
End date
2019-03-29
Secondary IDs
Abstract
This study explores whether the existence of opportunities to extract personal rents in a job affects the number and type of individuals who are attracted to it. This question is especially relevant for recruitment and personnel policies in sectors where positions have -or are perceived to have- some discretion to obtain personal rents (i.e. public sector in developing countries). The central concern we address is that the availability of such rents may affect the pool of applicants to such positions towards the more dishonest.
External Link(s)
Registration Citation
Citation
Brassiolo, Pablo et al. 2019. "Rent extraction opportunities and self-selection into the public sector. Evidence from the Lab." AEA RCT Registry. February 12. https://doi.org/10.1257/rct.3877-1.0
Former Citation
Brassiolo, Pablo et al. 2019. "Rent extraction opportunities and self-selection into the public sector. Evidence from the Lab." AEA RCT Registry. February 12. https://www.socialscienceregistry.org/trials/3877/history/41432
Experimental Details
Interventions
Intervention(s)
We design a lab experiment in which individuals choose between two “contracts”: the first one is designed to reflect basic properties of a private sector contract (“private contract”) and, the second one reflects basic properties of a public sector contract (“public contract”). We then exogenously introduce the possibility of extracting rents in the “public contract” for one group of the subjects. From there, we study how that opportunity to extract rents affects the choice between contracts made by individuals. Our hypothesis is that individuals with a higher propensity to cheat (as capture by a dishonesty measure) will disproportionately increase the rate at which they choose the public contract when the rent extraction opportunity is introduced.
Intervention Start Date
2019-02-11
Intervention End Date
2019-02-18
Primary Outcomes
Primary Outcomes (end points)
The main outcome of interest is the choice to work under a private or public contract. In addition, we use our setting to embed a second experiment. In it, we consider only the subjects that self-selected into the public contract without rent extraction opportunities. After they have made that choice, we exogenously introduce the possibility to extract rents for a sub-group of them. This allows us to test if, even among those who self-selected into the same contracts, there is a pure “incentive” channel linking opportunities for rent extraction with actual graft. The literature that explores job characteristics with individual performance has long attempted to separate “selection” and “incentive” channels. Regrettably, this is almost impossible to do in a real-world setting, given that the features of the job that shape the incentives of the individuals are the same that shaped their selection into that position in the first place. Thus, it is next to impossible to cleanly attribute observed behavior to the “selection” or “incentive” channel. By performing a double randomization of job characteristics, we are able to produce estimates of the relative importance of each channel on the observed graft.
Primary Outcomes (explanation)
Secondary Outcomes
Secondary Outcomes (end points)
Secondary Outcomes (explanation)
Experimental Design
Experimental Design
We will conduct a lab experiment. Each session consists of: (i) A survey collecting socio-economic and demographic information and individual measures of risk attitude, pro-social motivation and personality traits of each subject, (ii) An experimental measure of dishonesty, (iii) An experimental game of contract choice and graft.
In the experimental game, participants will have to choose between two alternative contracts that are intended to emulate private sector and public sector job characteristics respectively (“private contract” and “public contract”, from now on). Under the private contract, participants have to perfom an effort-based task. They receive a fixed payment and a performance-based payment. Under the public contract, subjects have to allocate a public fund among five NGOs, and receive a fixed amount as a compensation.
The first treatment we are interested in is whether the size and the composition of the pool of subjects who choose the public contract vary (increase) when there exists rent extraction opportunities. To implement this, the public fund to be allocated among the NGOs is composed of toy-banknotes in the control group, while it is composed by real money in the treatment group, introducing the possibility of graft.
We are interested in a second treatment. Among those participants who were first assigned to the control group and chose the public contract, we randomly choose a subset and inform them they will receive real cash instead of toy banknotes. That is, we introduce the possibility of graft, but after individuals have self-selected into their contracts. We want study the effects of giving them the opportunity to extract rents on their behavior (i.e. whether they keep money from the public fund for themselves).
Experimental Design Details
Randomization Method
Randomization done in office by a computer.
Randomization Unit
Individual
Was the treatment clustered?
No
Experiment Characteristics
Sample size: planned number of clusters
450 individuals
Sample size: planned number of observations
450 individuals
Sample size (or number of clusters) by treatment arms
Treatment 1:
150 subjects treated, 300 subjects as controls,
Treatment 2:
75 subjects treated, 75 in the control group
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB
INSTITUTIONAL REVIEW BOARDS (IRBs)
IRB Name
Comité de Ética en Investigación de la Universidad del Rosario - Sala de Ciencias Sociales
IRB Approval Date
2019-02-01
IRB Approval Number
DVO005-175-CS110
Analysis Plan

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Post-Trial
Post Trial Information
Study Withdrawal
Intervention
Is the intervention completed?
No
Is data collection complete?
Data Publication
Data Publication
Is public data available?
No
Program Files
Program Files
Reports and Papers
Preliminary Reports
Relevant Papers