Department of Economics
Lahore University of Management Sciences
and Institute of Development and Economic Alternat
NBER Working Papers and Publications
|May 2018||Trust in State and Non-State Actors: Evidence from Dispute Resolution in Pakistan|
with Daron Acemoglu, Asim I. Khwaja, James A. Robinson: w24611
Lack of trust in state institutions, often due to poor service provision, is a pervasive problem in many developing countries. If this increases reliance on non-state actors for crucial services, the resulting self-reinforcing cycle can further weaken the state. This paper examines whether such a cycle can be disrupted. We focus on dispute resolution in rural Punjab, Pakistan. We find that providing information about reduced delays in state courts leads to citizens reporting higher willingness to use state courts and to greater fund allocations to the state in two lab-in-the-field games designed to measure trust in state and non-state actors in a high-stakes setting. More interestingly, we find indirect effects on non-state actors. After receiving state positive information, respondents re...