11:20 - 13:00
P7-S183
Room: 1A.09
Chair/s:
Patrick E Shea
Discussant/s:
Ameetosri Basu
Do Government Audits Reduce Bureaucrats’ Rent Extraction?
P7-S183-5
Presented by: Felipe Torres Raposo
Felipe Torres Raposo 1, Luis Soto Tamayo 2
1 London School of Economics and Political Science
2 King's College London
Governments have widely implemented audits to curb corruption, increase accountability, and discourage patronage practices within the public sector. This paper focuses on the impact of audits on civil servants by looking at two main aspects: first, whether audits effectively discourage 'rent-extraction' behaviour among civil servants, and second, whether the audits have a differentiated effect on civil servants with family affiliations. We employ a unique dataset from Chile's 2016 financial and performance audits of civil servants and leverage the random audit assignment across 17 governmental institutions over 8,640 public servants. Our preliminary analysis suggests that audits discourage public officials from engaging in rent extraction, but this impact is small and insignificant. We find some suggestive evidence that bureaucrats offset this drop in rent extraction by either extracting rent from other sources of government activities or by increasing the amount involved in current ones.
Keywords: Corruption; Patronage; Audits

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