Institutional Uncertainty and State Building: National-Scale Experimental Evidence from Nepal
Coauthors: Stefano Fiorin (Bocconi), Rohini Pande (Yale), Soledad Prillaman (Stanford), Jonathan Weigel (Berkeley), Noam Yuchtman (LSE)
Abstract:
We report results from a nationwide field experiment testing whether policymakers’ beliefs about the durability of political institutions affects their willingness to invest effort in building state capacity. We randomly provided accurate information about either political stability or political inclusion to 4,400 local politicians and bureaucrats in Nepal — a country that transitioned to federal democracy in 2015. The stability treatment informed respondents about Nepal’s percentile ranking on international measures of political stability. This information increased expectations that the country’s new constitutional rules — including those regarding executive selection, judicial independence, and media freedom — will persist in the future. Participants were then offered a real-effort opportunity to contribute to a core state function: collecting data on births, deaths, and marriages to support Nepal’s effort to modernize its civil registration system. The stability treatment increased participation in this state-building task from 22% in the control group to 26% in the treatment group (p < 0.05). By contrast, providing accurate information about the political representation of women and historically underrepresented caste groups reduced optimism about the durability of new constitutional guarantees and decreased participation among those groups. Taken together, the results indicate that beliefs about the durability and character of political institutions causally affect policymakers’ willingness to invest effort in building state capacity. More broadly, the findings support institutionalist theories emphasizing the role of expectations about how institutions allocate and constrain political power in shaping incentives to invest in building the state (North 1990, 1991; North, Wallis, Weingast, 2009).
Organized by: Miguel Ortiz
