Authentication and Targeted Transfers: Experimental Evidence from India
Paul Niehaus, Department of Economics, UC San Diego
In developing countries, the state often has limited capacity to effectively target transfers. We examine the effects of enhanced authentication technology on the de facto performance of India’s largest targeted transfer scheme, the Public Distribution System. We conduct an experiment at scale with the state government of Jharkhand, randomizing the rollout of biometric authentication in large units and within a representative sample. In contrast with press coverage, we find that this reform did not significantly or substantially reduce legitimate beneficiaries access’ to benefits on average, though it did raise transaction costs slightly. In (instructive) contrast with our own work elsewhere, however, we also find little evidence that better authentication reduced leakage.