Does transparency make local governments more responsive?

Evidence from the Philippines using difference-in-difference approach

Joseph Capuno(University of the Philippines)

Maria Melody Garcia(University of Rome – Tor Vergata)

Objective

• The paper tests the proposition that transparency make local governments more responsive using data from a local governance project piloted in 12 municipalities/cities

• Specifically, we test if public information on local government performance would have a positive impact on public service delivery and assessed responsiveness of officials to the needs of their constituents

Related Literature

• The evidence is mixed regarding the responsiveness of local governments (LG) to local needs under decentralization

• Faguet (2004) found supporting evidence in Bolivia

• Lewis (2005) found in Indonesia that LGs are only partly responsive to local needs, and also partly captured by local elites

• Ahmad et al (2005) found mixed results

The Philippine experience under decentralization

• There have been proliferation of innovative local public services since 1991 when the Local Government Code was adopted (Capuno, 2007).

• There are also cases where middling leaders or corrupt ones further entrenched their hold to political power (Lacaba, 1995)

• Azfar et al (2001) found that local officials do not necessarily make use of their superior information in making fiscal decisions

The Good Governance and Local Development Project

• Aimed to develop and advocate the institutionalization of a set of indicators of good governance - the Governance for Local Development Index (GI)

• GI was piloted for two years (2001-2002) in 12 municipalities/cities of the provinces of Bulacan and Davao del Norte

• The pilot test was conducted to investigated the impact of public dissemination of local government performance on the citizens’ perceived responsiveness of local officials

Pilot Areas and Local PartnersRelative Levels of Development

Bulacan Davao del NorteTreatment Areas Control Areas Treatment Areas Control Areas

LGU PartnerCivil Society

PartnerCivil

Society Partner

LGU PartnerCivil Society

PartnerCivil

Society Partner

HighSan Jose del Monte City(City Planning and Development Office)

Baliwag(Soropti-mist Internatio-nal of Baliwag)

Plaridel (Bulacan State University- Bustos Campus*, Rotary Club of Bustos**)

Panabo City(City Planning and Develop-ment Office)

Sto. Tomas (Davao Provinces Rural Develop-ment Institute, Inc.)

Tagum City(St. Mary’s College-Tagum City*, University of Southeastern Philippines**)

LowGuiguinto(Municipal Planning and Development Office)

Angat (Rotary Club of Angat)

Bustos (Bulacan State University- Bustos Campus*, Rotary Club of Bustos**)

Braulio E. Dujali (Municipal Planning and Development Office)

Island Garden City of Samal (LAWIG Foundation)

Asuncion (PhilNet-Rural Development Institute*, University of Southeastern Philippines**)

The Governance for Local Development Index (GI)

Public Service Needs Expenditure Prioritization

Participatory Development

The GI Scores• Ranges from 0 to 100• The scores were not announced in the control sites• The scores were announced in the treatment sites

through posters, stickers, magazines • The scores were also presented by the local

partners in public forums for at least three times and an extra forum was held exclusively for local officials

• The public dissemination of the assessed performance of LGs is expected to influence the behavior of the local officials and their constituents

The Data• Three rounds of random household surveys• Same sampling design and instrument• 100 household respondents per municipality• Sampling weights were used

Baseline survey Apr-May 2001

Pilot period 1Feb-Mar 2002

Pilot period 2Feb-Mar 2003

First round of GI scores Jun-Aug 2001

Second round of GI scores Mar-Sep 2002

Demographic characteristics

Variables

Baseline Pilot period 1 Pilot period 2  

MeanControl

Mean Treatme

ntp-

valueMean

Control

Mean Treatme

ntp-

valueMean

Control

Mean Treatme

nt p-valueTotal

 

Other index 0.446 0.500 0.081 0.455 0.344 0.000 0.256 0.199 0.026 0.360

Age 40.390 41.361 0.226 41.751 41.949 0.836 43.315 42.492 0.382 41.895

Income(ln) 8.657 8.696 0.486 8.712 8.587 0.049 8.710 8.502 0.000 8.628

College 0.302 0.292 0.711 0.221 0.248 0.302 0.238 0.248 0.703 0.260

Electric bill 488.39 458.11 0.404 411.24 478.23 0.185 452.43 467.70 0.653 462.29

Regular job 0.526 0.512 0.640 0.616 0.629 0.648 0.601 0.532 0.026 0.566

Government employee 0.063 0.064 0.964 0.062 0.064 0.893 0.069 0.061 0.598 0.064

Owner 0.753 0.745 0.773 0.551 0.601 0.106 0.711 0.678 0.250 0.674

Married 0.834 0.801 0.177 0.795 0.778 0.513 0.790 0.800 0.698 0.798

Household head 0.335 0.354 0.547 0.468 0.419 0.119 0.409 0.360 0.100 0.386

Spouse 0.542 0.509 0.298 0.382 0.398 0.593 0.455 0.481 0.415 0.462

Family size 5.307 5.200 0.462 5.042 5.127 0.534 5.197 5.342 0.293 5.210

Male 0.317 0.296 0.449 0.278 0.325 0.107 0.297 0.306 0.731 0.305

Re-elected Mayor 0.501 0.870 0.000 0.494 0.886 0.000 0.501 0.886 0.000 0.751

High income barangay 0.798 0.676 0.000 0.800 0.679 0.000 0.798 0.679 0.000 0.719

No. of observations 397 754   385 761   391 770   3458

Evaluation framework• DiD – differences in responsiveness of LG

before and after the introduction of the index in the control site is calculated, and then subtracted from the differences in the responsiveness of the LG officials before and after the introduction of the index in the treatment sites

Desirable changes in the delivery of public service

Desirable changes Coefficient Z-statistic

Treatment x Pilot period 1 0.222*** 4.341

Treatment x Pilot period 2 0.101** 2.392

Treatment x Pilot period 1 & 2 0.148*** 3.419

Desirable changes CSO/NGO partners LGU partners

Coefficient Z-statistic Coefficient Z-statistic

Treatment x Pilot period 1 0.115** 2.108 0.285*** 3.092

Treatment x Pilot period 2 0.056 1.157 0.133** 2.369

Treatment x Pilot period 1 & 2 0.055 1.098 0.198*** 3.74

*** p<0.01, **p<0.05, * p<0.10

Mayor’s responsiveness to complaintsMayor's responsiveness to complaints Coefficient Z-statistic

Treatment x Pilot period 1 0.111** 2.201

Treatment x Pilot period 2 -0.07 -1.424

Treatment x Pilot period 1 & 2 0.029 0.67

Mayor's responsiveness to complaints CSO/NGO partners LGU partners

Coefficient Z-statistic Coefficient Z-statistic

Treatment x Pilot period 1 0.002 0.033 0.182** 2.326

Treatment x Pilot period 2 -0.205*** -3.649 0.038 0.668

Treatment x Pilot period 1 & 2 -0.089** -1.902 0.115** 2.232

*** p<0.01, **p<0.05, * p<0.10

Responsiveness of local officialsResponsiveness of local officials Coefficient Z-statisticMayorTreatment x Pilot period 1 0.033 0.661Treatment x Pilot period 2 -0.098** -2.067Treatment x Pilot period 1 & 2 -0.026 -0.611Vice MayorTreatment x Pilot period 1 0.037 0.859Treatment x Pilot period 2 -0.002 -0.045Treatment x Pilot period 1 & 2 0.014 0.339Municipal councilorsTreatment x Pilot period 1 0.059 1.298Treatment x Pilot period 2 -0.046 -0.978Treatment x Pilot period 1 & 2 0.008 0.189Barangay councilorsTreatment x Pilot period 1 0.174*** 3.488Treatment x Pilot period 2 0.07 1.361Treatment x Pilot period 1 & 2 0.129*** 3.108Barangay captainTreatment x Pilot period 1 0.113** 2.345Treatment x Pilot period 2 -0.011 -0.303Treatment x Pilot period 1 & 2 0.06 1.532

*** p<0.01, **p<0.05, * p<0.10

Responsiveness of officialsResponsiveness of local officials CSO/NGO partners LGU partners

Coefficient Z-statistic Coefficient Z-statisticMayorTreatment x Pilot period 1 -0.066 -1.221 0.106* 1.472Treatment x Pilot period 2 -0.170*** -3.018 -0.004 -0.1Treatment x Pilot period 1 & 2 -0.115** -2.426 0.048 0.915Vice MayorTreatment x Pilot period 1 -0.008 -0.147 0.08 1.263Treatment x Pilot period 2 -0.05 -0.904 0.066 1.195Treatment x Pilot period 1 & 2 -0.032 -0.664 0.046 0.912Municipal councilorsTreatment x Pilot period 1 -0.004 -0.08 0.126* 1.908Treatment x Pilot period 2 -0.071 -1.303 0.029 0.544Treatment x Pilot period 1 & 2 -0.038 -0.787 0.048 0.94Barangay councilorsTreatment x Pilot period 1 0.065 1.304 0.258*** 2.969Treatment x Pilot period 2 0.019 0.463 0.198*** 3.444Treatment x Pilot period 1 & 2 0.035 0.87 0.200*** 3.827Barangay captainTreatment x Pilot period 1 0.009 0.175 0.171* 1.847Treatment x Pilot period 2 -0.049 -1.099 0.1 1.956Treatment x Pilot period 1 & 2 -0.017 -0.434 0.112** 2.333*** p<0.01, **p<0.05, * p<0.10

Conclusion (1)• Overall, the result shows that the index has

increased the probability of improving delivery of public service.

• Mayor’s responsiveness to complaints appeared short-lived

• The effect of the index on local officials’ probability of being responsive is mixed. Municipal officials tend to be less responsive than their village counterpart.

Conclusion (2)

• Impact of index on improved public service delivery is strongest if disseminated by LGs

• Positive effect on responsiveness if the LGs made the announcement and negative effects if the announcement is made by CSO/NGOs.

• The effectiveness of the index may depend on the characteristic of the local partner.

Implications in the design of performance rating systems

• An effective accountability mechanism is a performance benchmarking system

• Rating or assessment matters. Has to be simple to be understood by an average resident

• Designating the announcement of scores to local NGO/CSO should be proceeded with care

• The presence of a neutral body can help lend credibility if scores are generated by LGs

• Perhaps the best solution in carrying out a local scorecard would be a partnership between LG units and CSO/NGO.

Thank you!