An Understanding India Seminar*
Featuring
Karthik Muralidharan
Assistant Professor of Economics
University of California, San Diego
With Discussant
Jessica Goldberg
Assistant Professor of Economics
University of Maryland
Hosted by
Alan Gelb
Senior Fellow
Center for Global Development
Technological constraints on the ability to send and receive money securely to remote locations are a common cause of poor implementation of anti-poverty programs. In new work based on one of the largest randomized controlled trials ever conducted, Karthik Muralidharan and colleagues (Paul Niehaus and Sandip Sukhtankar) study the role that payments infrastructure that combines electronic benefit transfers and biometric authentication can play in improving these programs. They find evidence of significant gains from the new system. Beneficiaries report receiving payments faster, making fewer trips to collect payments, and having to pay less in bribes to do so. They also find a reduction in leakage rates, which in turn result in improvements in the performance of the public workfare program, and increased private sector wages and household income. These results suggest that investing in secure authentication and payment infrastructure can significantly enhance "state capacity'' in developing countries to effectively implement a broad range of welfare programs.
*The Understanding India Seminars Series is organized by CGD's Understanding India initiative, which explores India's development challenges and experiences and the lessons they might offer for other developing countries.*
