Abstract: How should citizens prove their identity in order to access publicly provided goods and services? We use a large-scale experiment to evaluate the effects of more stringent ID requirements based on biometric authentication currently being imposed by the Government of India, characterizing how this has affected errors of inclusion and of exclusion in the delivery of subsidized food in the state of Jharkhand. Per se, requiring biometric authentication to transact did not reduce leakage, slightly increased transaction costs for the average beneficiary, and substantially reduced benefits received for the 23% of beneficiaries who had not previously linked an ID to the program database. Subsequent reforms that made use of authenticated transaction data to reduce allocations to the program coincided with large reductions in leakage, but also significant reductions in benefits received. Our results highlight the shadow costs in terms of exclusion that can arise from attempts to reduce corruption in welfare programs.
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