The Eye Is Not Enough

As shown in Chapter 3, nonelected officials can and often do abuse their power. Hence, the question: under what conditions can anticorruption audits improve government accountability? In order to approach an answer, in this chapter, I describe a field experiment that relied on a unique collaboration with the city government of Querétaro in central Mexico. Fifty building permit applications were randomly assigned to enter into an experimental group. The officials responsible for reviewing the permits were made aware that, as an independent auditor, I was carefully examining all the physical documentation for applications within this group. The same permit reviewers did not realize that another set of fifty randomly selected permit applications were part of a comparison group and, thus, also subject to my scrutiny. This design tests whether permit reviewers improve their behavior when exposed to outside scrutiny. With implications for corruption control, the study’s results reveal that monitoring spurs greater diligence and stringency among officials, but only when they sense the risk of a top-down sanction. The eye is only effective when accompanied by a whip.