Audits and Government Hiring Practices

Maximiliano Lauletta, Martín Rossi and Christian Ruzzier

Economica, 2022, vol. 89, issue 353, 214-227

Abstract: We exploit the random assignment of Brazilian municipalities to an audit programme to explore the link between audits and government hiring practices. We find that audited municipalities employ less labour to provide a given level of public services, and change the way in which they screen their employees—relying less on discretion and more on merit. Given that audits reduce corruption in the activities under scrutiny, our results suggest that different types of corruption can be complements rather than substitutes.

Date: 2022
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