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Abstract:

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Development Discussion Paper
Development Policy through the Lens of Social Structure
Oriana Bandiera, Robin Burgess, Erika Deserranno, Ricardo Morel, Imran Rasul and Munshi Sulaiman May 2020
Paper No' EOPP 69:
Full Paper (pdf)

JEL Classification: O10; O20; D80


Tags: social structure; development policy; social ties; agriculture extension

This paper studies how the social structure of village economies affects policy implementation by local agents. We randomly select one of two viable candidates to deliver an agricultural extension program in rural Ugandan villages. We show that delivery agents favor their own social ties over ex-ante identical farmers connected to the other (non-selected) candidate and that this is inconsistent with output maximization or targeting the poorest. Favoritism disappears when the potential delivery agents belong to the same social group. Using the randomised allocation of the program across villages, we show how unobserved social structures explain the variation in delivery rates and program effectiveness that we often observe in the data.