Non-payment and strategic enforcement: Experimental evidence from Indian electricity

State revenue collection is challenging in developing-country settings, which in turn reduces the ability of the state to provide public goods. Electricity is a key sector facing substantial revenue challenges. Frequent bill non-payment leads utilities to provide low-quality power supply, including imposing regular blackouts (Burgess et al 2020). In this project, we are working with two state utilities in Madhya Pradesh, India to measure the effectiveness of and design an optimal targeting strategy for enforcement. We randomize 30,000 households into a control group and a variety of enforcement treatments, informed by the public finance literature on tax payments (e.g. De Neve et al 2021), ranging from SMS reminders to disconnections. We plan to compute direct effects of these treatments on bill payments and electricity consumption. We will also estimate treatment effect heterogeneity. To consider optimal targeting from the household's perspective, we will conduct an endline survey to measure household finances, consumption, psychological well-being, and other measures, in order to consider optimal targeting from the household's perspective.