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Empty Reasons? Evidence from a Natural Experiment on the Effect of Public Reasoning Requirements

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413

Abstract

Norms of reason-giving rest at the foundation of public institutions, plausibly disciplining officials where financial and electoral incentives do not apply. Yet do requirements for reason-giving induce officials to pursue statutory objectives or behave prosocially? Little observational evidence exists on this question. I study a natural experiment in federal procurement in which contracting officials were required to provide reasons if they awarded certain noncompetitive contracts but only if valued above a statutory threshold. Using a difference-in-differences design, I find that the reason-giving requirement substantially increased the probability that officials competed contracts, thus complying with the statutory objective. I also explore a discontinuity design but discover sorting around the threshold by sophisticated entities, further supporting the materiality of reason-giving. Secondary results suggest the requirement reduced the volume of contracts awarded and altered the composition of firms receiving contracts. These findings speak to the force of reason-giving requirements and their complex trade-offs.

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