Politicians, Bureaucrats, and Development: Evidence from India
by Saad Gulzar, New York University & Benjamin J. Pasquale, Independent Researcher
Political interference in the bureaucracy is generally viewed with suspicion. Yet, in a democracy, should we not expect politicians to push bureaucrats to work for the best interests of citizens? We study the impact of political oversight in the case of India’s Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS), the largest employment program in the world. We construct an original dataset of nearly half a million villages to analyze a natural experiment in India, where political and bureaucratic jurisdictions overlap unevenly. This allows us to compare bureaucrats who answer to a single politician, with those who report to multiple politicians. Our analysis shows that when oversight is not divided among many politicians, the implementation of MNREGS improves by about ten percent. In addition, this difference in bureaucratic performance diminishes if politicians are able to claim credit for the improvements. Our results indicate that instead of firewalling development programs from political interference, policy makers should aim to align politicians’ electoral incentives with the successful implementation of programs.