TY - JOUR AU - Banerjee, Abhijit AU - Hanna, Rema AU - Kyle, Jordan C AU - Olken, Benjamin A AU - Sumarto, Sudarno TI - The Power of Transparency: Information, Identification Cards and Food Subsidy Programs in Indonesia JF - National Bureau of Economic Research Working Paper Series VL - No. 20923 PY - 2015 Y2 - February 2015 DO - 10.3386/w20923 UR - http://www.nber.org/papers/w20923 L1 - http://www.nber.org/papers/w20923.pdf N1 - Author contact info: Abhijit Banerjee Department of Economics, E52-540 MIT 77 Massachusetts Avenue Cambridge, MA 02139 Tel: 617/253-8855 Fax: 617/253-1330 E-Mail: banerjee@mit.edu Rema Hanna Kennedy School of Government Harvard University 79 JFK Street Cambridge, MA 02138 Tel: 617/496-1140 Fax: 617/496-5747 E-Mail: Rema_Hanna@hks.harvard.edu Jordan C. Kyle International Food Policy Research Institute 2033 K Street NW Washington, DC 20006 E-Mail: jordanckyle@gmail.com Benjamin A. Olken Department of Economics, E52-542 MIT 77 Massachusetts Avenue Cambridge, MA 02139 Tel: 617/588-1437 Fax: 617/868-2742 E-Mail: bolken@mit.edu Sudarno Sumarto TNP2K Jl. Kebon Sirih Jakarta Indonesia and SMERU E-Mail: ssumarto@smeru.or.id AB - Can governments improve aid programs by providing information to beneficiaries? In our model, information can change how much aid citizens receive as they bargain with local officials who implement national programs. In a large-scale field experiment, we test whether mailing cards with program information to beneficiaries increases their subsidy from a subsidized rice program. Beneficiaries received 26 percent more subsidy in card villages. Ineligible households received no less, so this represents lower leakage. The evidence suggests that this effect is driven by citizen bargaining with local officials. Experimentally adding the official price to the cards increased the subsidy by 21 percent compared to cards without price information. Additional public information increased higher-order knowledge about eligibility, leading to a 16 percent increase in subsidy compared to just distributing cards. In short, increased transparency empowered citizens to reduce leakages and improve program functioning. ER -