State Paralysis: The Impacts of Procurement Risk on Government Effectiveness

Last registered on August 05, 2022

Pre-Trial

Trial Information

General Information

Title
State Paralysis: The Impacts of Procurement Risk on Government Effectiveness
RCT ID
AEARCTR-0009821
Initial registration date
July 29, 2022

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 03, 2022, 2:42 PM EDT

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

Last updated
August 05, 2022, 7:08 PM EDT

Last updated is the most recent time when changes to the trial's registration were published.

Locations

Region

Primary Investigator

Affiliation
University of California, Davis

Other Primary Investigator(s)

PI Affiliation
University of California, Davis
PI Affiliation
London School of Economics
PI Affiliation
Fundação Getulio Vargas

Additional Trial Information

Status
On going
Start date
2022-07-12
End date
2023-02-15
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Public procurement plays a key role in allocating limited budgetary resources to public service delivery in countries with a functional rule of law. This project studies a puzzling phenomenon: in developing countries like Brazil, substantive shares of the federal and sub-national budgets are not spent despite clear needs for additional resources to improve the quality of public services or to fund emergency spending in contexts of crisis. In line with a growing literature that documents the potential unintended effects of the enforcement of rules on bureaucratic performance, we investigate the role of procurement risk - when passive waste is misinterpreted as active waste – as a driver of unspent public funds by Brazilian municipal governments. Randomizing information that decreases the perception of procurement risk, we investigate its effects on budget execution.
External Link(s)

Registration Citation

Citation
Fernandes, Gustavo et al. 2022. "State Paralysis: The Impacts of Procurement Risk on Government Effectiveness ." AEA RCT Registry. August 05. https://doi.org/10.1257/rct.9821-2.1
Experimental Details

Interventions

Intervention(s)
We administer a survey to local bureaucrats in the health sector that seeks to understand their demand for different strategies that facilitate the execution of resources.
In the survey, we will introduce exogenous variation in the perception of procurement risk associated with each strategy by randomizing the content of the provided information. In the first round, we randomly assign information on whether the spending plan will be interpreted as compliant with the rules by the control agency. In the second round, the experiment will also randomize the complexity of the budget execution strategy.
The survey experiment will be implemented in collaboration with CONASEMS, the Brazilian Council of Municipal Health Secretaries. We will administer it during CONASEMS conferences organized over time, starting the pilot at CONASEMS annual congress in July/2022. These events bring together local bureaucrats in the health sector from all over Brazil.
Intervention Start Date
2022-07-12
Intervention End Date
2023-02-15

Primary Outcomes

Primary Outcomes (end points)
​​Our outcome variable will be participants’ demand for different strategies to execute resources. Following a Becker-DeGroot-Marschak (BDM) procedure, we will elicit participants’ maximum willingness to pay to receive these strategies. This will inform us about local health officials’ demand for guarantees of approval from the control agency. Also, we will capture demand for complex initiatives when they have the guarantee that the control agency will approve.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The survey experiment will first describe some of the main problems that municipalities are dealing with in the health sector. We will present to health officials several initiatives that aim to overcome those challenges. These solutions will be presented along with a strategy to execute resources. We will use the Becker-DeGroot-Marschak (BDM) method to elicit participants’ demand for the proposed strategies.
In the first round, the sample will be randomized into treatment and control group. The treatment group will receive information increasing the guarantee that the control agency will approve the expenses once the strategy to execute resources is implemented. This treatment reduces the perception of procurement risk associated with budget execution. Health officials in the control group will not be given any guarantee that the spending plan will be interpreted as compliant with the rules.
In the second round, the experiment will randomize the complexity of the proposed policy. Participants in the treatment group will be presented a more complex health intervention, increasing the perceived risk of incurring procedural mistakes that could be framed as wrongdoing. We will also randomize in the second round the information on whether the spending plan will be interpreted as compliant with the rules by the control agency. Then, a fourth of the sample is expected to be assigned to each treatment arm.
Experimental Design Details
Not available
Randomization Method
Randomization done on the spot by Qualtrics.
Randomization Unit
Individual
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
None
Sample size: planned number of observations
300 individuals
Sample size (or number of clusters) by treatment arms
In the first round, half of the sample will be assigned to treatment and half to control group.
In the second round, one fourth will receive T1+T2, one fourth T1+C2, one fourth C1+T2, and one fourth C1+C2. Being T1 the compliance treatment and T2 the complexity treatment.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number
Analysis Plan

Analysis Plan Documents

PaP_July2022_AEA.pdf

MD5: f8922bcb5238b083a0e623beee69737f

SHA1: a35850f0efc43600c714d6edcd7cefb8e09b6362

Uploaded At: August 05, 2022