What Transparency Can Do When Incentives Fail
What Transparency Can Do When Incentives Fail

Author: Elisabeth Paul

Publisher: International Monetary Fund

Published: 2006-06

Total Pages: 40

ISBN-13:

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This paper analyzes the pervasiveness and persistence of rent seeking, misgovernance, and public sector inefficiency in many developing and transition economies. We formalize evidence from country experiences and empirical studies into a stylized analytical framework that reflects realistic constraints faced in these countries. Our work departs from the standard economic literature by assuming that (i) the relationship between the government and its population is regulated through an implicit social consensus; (ii) traditional incentives (in the form of public expenditure controls, sanctions, or monetary incentives to perform) are, for various reasons, ineffective in many of these countries; and (iii) the persistence of high corruption reflects a very stable equilibrium, which in turn reflects the fact that several constraints are simultaneously binding. We argue that, when traditional incentives fail, transparency-information provision and disclosure, together with the means to use it-by relaxing different constraints, can contribute to improving public outcomes.

What Transparency Can Do When Incentives Fail
What Transparency Can Do When Incentives Fail

Author: Elisabeth Paul

Publisher: INTERNATIONAL MONETARY FUND

Published: 2006-06-01

Total Pages: 35

ISBN-13: 9781452702414

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This paper analyzes the pervasiveness and persistence of rent seeking, misgovernance, and public sector inefficiency in many developing and transition economies. We formalize evidence from country experiences and empirical studies into a stylized analytical framework that reflects realistic constraints faced in these countries. Our work departs from the standard economic literature by assuming that (i) the relationship between the government and its population is regulated through an implicit social consensus; (ii) traditional incentives (in the form of public expenditure controls, sanctions, or monetary incentives to perform) are, for various reasons, ineffective in many of these countries; and (iii) the persistence of high corruption reflects a very stable equilibrium, which in turn reflects the fact that several constraints are simultaneously binding. We argue that, when traditional incentives fail, transparency-information provision and disclosure, together with the means to use it-by relaxing different constraints, can contribute to improving public outcomes.

The International Handbook of Public Financial Management
The International Handbook of Public Financial Management

Author: Richard Allen

Publisher: Springer

Published: 2013-08-15

Total Pages: 1126

ISBN-13: 113731530X

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The Handbook is a virtual encyclopedia of public financial management, written by topmost experts, many with a background in the IMF and World Bank. It provides the first comprehensive guide to the subject that has been published in more than ten years. The book is aimed at a broad audience of academics/students, government officials, development agencies and practitioners. It covers both bread-and-butter topics such as the macroeconomic and legal framework for budgeting, budget preparation and execution, procurement, accounting, reporting, audit and oversight, as well as specialist subjects such as government payroll systems, local government finance, fiscal transparency, the management of fiscal risks, sovereign wealth funds, the management of state-owned enterprises, and political economy aspects of budgeting. The book sets out numerous examples and case studies describing good practice in public financial management, and is highly relevant for use in both advanced and developing countries.

When Transparency Fails
When Transparency Fails

Author: Jorge Mejia

Publisher:

Published: 2019

Total Pages: 31

ISBN-13:

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Providing transparency into operational processes can change consumer and worker behavior. However, it is unclear whether operational transparency is beneficial with potentially biased service providers. We explore this in the context of ridesharing platforms where early evidence documents bias similar to what has been observed in traditional transportation systems. Platforms responded by reducing operational transparency through removing information about riders' gender and race from the ride request presented to drivers. However, following this change, bias may still manifest through driver cancelation after a request is accepted, at which point the rider's picture is displayed. Our primary research question is to what extent a rider's gender, race, and perception of support for lesbian, gay, bisexual, and transgender (LGBT) rights impact cancelation rates. We investigate this through a large field experiment on a major ridesharing platform in Washington, DC. By manipulating rider names and profile pictures, we observe drivers' behavior patterns in accepting and canceling rides. Our results confirm that bias at the ride request stage has been eliminated. However, after acceptance, racial and LGBT biases are persistent, while we find no evidence of gender biases. We also explore whether peak times moderate (through increased pay to drivers) or exacerbate (by signaling that there are many riders, allowing drivers to be more selective) these biases. We find a moderating effect of peak timing, with lower cancelation rates for non-caucasian riders. We do not find a similar moderating effect for riders that signal support for the LGBT community.

Performance Budgeting
Performance Budgeting

Author: M. Robinson

Publisher: Springer

Published: 2007-08-30

Total Pages: 544

ISBN-13: 1137001526

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This book examines the theory and practice of performance budgeting, which aims make government more effective by linking the funding of government agencies to the results they deliver. Combining thematic studies and case studies, it clearly presents the diverse range of contemporary performance budgeting models and examines their effectiveness.

Incentives to Pander
Incentives to Pander

Author: Nathan M. Jensen

Publisher: Cambridge University Press

Published: 2018-03-15

Total Pages: 271

ISBN-13: 1108311423

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Policies targeting individual companies for economic development incentives, such as tax holidays and abatements, are generally seen as inefficient, economically costly, and distortionary. Despite this evidence, politicians still choose to use these policies to claim credit for attracting investment. Thus, while fiscal incentives are economically inefficient, they pose an effective pandering strategy for politicians. Using original surveys of voters in the United States, Canada and the United Kingdom, as well as data on incentive use by politicians in the US, Vietnam and Russia, this book provides compelling evidence for the use of fiscal incentives for political gain and shows how such pandering appears to be associated with growing economic inequality. As national and subnational governments surrender valuable tax revenue to attract businesses in the vain hope of long-term economic growth, they are left with fiscal shortfalls that have been filled through regressive sales taxes, police fines and penalties, and cuts to public education.

Too Big to Fail?
Too Big to Fail?

Author: United States. Congress. House. Committee on the Judiciary. Subcommittee on Courts and Competition Policy

Publisher:

Published: 2009

Total Pages: 96

ISBN-13:

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Transparency and Critical Theory
Transparency and Critical Theory

Author: Jorge I. Valdovinos

Publisher: Springer Nature

Published: 2022-02-26

Total Pages: 431

ISBN-13: 303095546X

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This book takes an interdisciplinary approach to the critique of contemporary ideology, offering an innovative genealogy of one of its most fundamental discursive manoeuvres: the ideological effacement of mediation. Providing a comprehensive historical revision of media (from the Greeks to the Internet), this book identifies several critical junctures at which the tension between visibility and invisibility has overlapped with conceptions of neutrality—a tension best incarnated in today's use of the word transparency. Then, it traces this term's evolving semantic constellation through a variety of intellectual discourses, exposing it as a key operator in the revaluation of ideals, sensibilities, and modalities of perception that lie at the core of our contemporary attention-based economy.

Capital Failure
Capital Failure

Author: Nicholas Morris

Publisher: OUP Oxford

Published: 2014-08-07

Total Pages: 433

ISBN-13: 019102077X

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Adam Smith's 'invisible hand' relied on the self-interest of individuals to produce good outcomes. Economists' belief in efficient markets took this idea further by assuming that all individuals are selfish. This belief underpinned financial deregulation, and the theories on incentives and performance which supported it. However, although Adam Smith argued that although individuals may be self-interested, he argued that they also have other-regarding motivations, including a desire for the approbation of others. This book argues that the trust-intensive nature of financial services makes it essential to cultivate such other-regarding motivations, and it provides proposals on how this might be done. Trustworthiness in the financial services industry was eroded by deregulation and by the changes to industry structure which followed. Incentive structures encouraged managers to disguise risky products as yielding high returns, and regulation failed to curb this risk-taking, rent-seeking behaviour. The book makes a number of proposals for reforms of governance, and of legal and regulatory arrangements, to address these issues. The proposals seek to harness values and norms that would reinforce 'other-regarding' behaviour, so that the firms and individuals in the financial services act in a more trustworthy manner. Four requirements are identified which together might secure more strongly trustworthy behaviour: the definition of obligations, the identification of responsibilities, the creation of mechanisms which encourage trustworthiness, and the holding to account of those involved in an appropriate manner. Financial reforms at present lack sufficient focus on these requirements, and the book proposes a range of further actions for specific parts of the financial industry.