Lecture 10: accountability Flashcards
Principal-Agent Model
- Principals employ agents to help achieve development
- But cannot see everything agents are doing (‘information asymmetry’)
- Principals set a contract with incentives
- Agents respond to those incentives
- Agents have their own objective
- Contracts and hierarchy are central to bureaucracies and development
Most organizations use this structure principal agents/hierarchy
Accountability Strategies in Development
Preventing Political Corruption
Horizontal Accountability: Independent agencies to monitor politicians
Example: International Commission against Impunity in Guatemala
Risk: Systems may collapse when threatened
Improving Teacher Performance
Performance-Related Pay: Bonuses for improved student scores
Result: Often fails to improve learning outcomes
Effective Aid Distribution
Cash on Delivery: Payments linked to development targets
Risk: Without clear conditions, money may not achieve desired results
Reasons Accountability Mechanisms Fail
Multiple Tasks
Incentives bias towards easy-to-measure tasks
Example: Teachers focus on testable material over creative thinking
Multiple Principals
Reporting to multiple politicians confuses and discourages supervision
Example: India’s NREGS saw 9% more access where bureaucrats reported to a single politician
Moral Hazard
Agents take excessive risks knowing they’ll be bailed out by principals
Principal’s Objectives
If the principal doesn’t want development, the agent will not pursue it
Compliance Challenges in Developing Contexts
Poverty and weak state capacity make enforcement difficult
Example: Teachers don’t arrive on time due to transport and health issues
Incentives Compete with Informal Institutions/Norms
Financial motivation can crowd out intrinsic motivation
Example: Performance incentives for teachers may reduce their intrinsic commitment to education
Discouraging Risky but Valuable Investments
Corruption compensates for weak institutions, making risky investments harder
Example 1: USAID cut support to Afghanistan’s health sector, which was saving 100,000 children per year, due to a lack of receipts
Example 2: Brazil’s random audits of government spending discouraged investment and worsened healthcare indicators
Voters are the ultimate principal in democracy
- Politicians are the agent
- Elections allow us to reward and sanction politicians
- Demand-side accountability, not supply-side’
- One Person, One Vote’
Why Voters Don’t Respond to Information About Politicians’ Performance
Political Skills Are Needed to Interpret Information
Voters need to understand who is responsible for what (e.g., who is accountable for healthcare).
Ethnic Voting
Voters may reward co-ethnics and punish ‘others,’ prioritizing ethnicity over performance.
Clientelism Short-Circuits Accountability
A single vote seems insignificant, but can secure direct benefits like $10 or a job.
Lobbying and Corruption Are More Important
Political influence and money can override the impact of votes.
“One dollar, one vote”
Lack of Social Contract
Without taxes, voters feel no strong obligation to punish bad politicians or hold them accountable.
Lack of Voter Coordination/Collective Action
Accountability depends on many voters reacting, but cynicism can hinder collective action.
“All politicians are thieves.”
Backfire
Anti-corruption messages may make citizens more likely to engage in corruption themselves.
Example: In Lagos, anti-corruption efforts led citizens to be more willing to pay bribes.
Backlash
Politicians may react to criticism with competing or false information to undermine accountability.
Social Accountability: Direct Citizen Engagement Outside Elections
Electoral Accountability is the ‘Long Route’
Relies on politicians responding to voters and being able to enforce changes through the state.
The election cycle takes time (typically four years) before you can influence change.
Social Accountability: The ‘Short Route’
Direct citizen engagement to hold government accountable, outside of electoral processes.
Citizens actively monitor, report, and participate in governance to demand services or improvements.
Definition
Accountability through direct citizen engagement outside of elections.
Voice or client power as per the World Bank (2004).
Led by civil society or by one part of the state against another.
Examples of Social Accountability Mechanisms:
Complaints: Writing letters, querying politicians, reporting issues in the media.
Citizen Monitoring: NGOs or citizens monitor services like healthcare and education.
Protests: Mobilizing the public to demand change.
Town Hall Meetings: Allowing citizens to voice concerns to local officials.
Participatory Budgeting: Involving citizens in decision-making about public spending.
Parent-Teacher Associations: Engaging citizens in improving school systems and services.
Why Social Accountability Often Fails
Citizens Lack Information, Skills, and Confidence
Eg. Struggling to attribute responsibility (who is to blame for the issue?).
Dependent on Allies in the State
Success relies on collaboration with state entities like judiciary, legislators, and statistical agencies for publishing data.
Backlash
Elites punish citizens who speak out, making them passive, especially under authoritarian regimes.
The Rich Exit to the Private Sector
Rich people abandon public services, reducing pressure for improvement.
Eg. In the Philippines, private schools undermine the quality of public schools (Gurgur, 2016).
Pressure Depends on Collective Action
Free-riding: Individual complaints have little effect; collective action is crucial for making change.
Audits - vertical accountability (citizens check gov) - were much
more effective
