This paper assesses the technical efficiency of 231 local municipalities in South Africa for 2007 and investigates the potential determinants of efficiency gaps using the non-parametric data envelopment analysis technique. Efficiency scores are explained in a second-stage regression model using a Tobit regression model. To the best of our knowledge, this is the first attempt, using such a technique, to assess technical efficiency at the local government level in the African context. The results show that, on average, B1 and B3 municipalities could have theoretically achieved the same level of basic services with about 16% and 80% fewer resources respectively. Furthermore, fiscal autonomy and the number and skill levels of the top management of a municipality's administration were found to influence the productive efficiency of municipalities in South Africa. Perhaps most importantly, the results depict a bleak picture of the democratic behaviour at the local level in South Africa. It appears that higher income and highly educated households do not feel the incentive to be active participants in public decision-making processes. The paper findings raise concerns over the future of local municipalities in the country, especially about their capability to efficiently deliver expected outcomes on a sustainable basis.

This is an Open Access paper distributed under the terms of the Creative Commons Attribution Non Commercial 4.0 International license, which permits downloading and sharing provided the original authors and source are credited -but the work is not used for commercial purposes. http://creativecommons.org/licenses/by-nc/4.0/legalcode SummaryAlthough field experiments in tax compliance represent a growing area of research, the literature has so far focussed exclusively on high and middle-income countries. This paper starts to fill this gap by reporting the results of a tax field experiment in Rwanda, while also highlighting some characteristics that may be common to other low-income countries. We evaluate an intervention carried out by the Rwanda Revenue Authority (RRA), which involved sending messages to taxpayers to nudge their declaration behaviour during the filing period of January-March 2016. Focussing particularly on business profits tax, our study is designed to address two interrelated questions. First, what are the key drivers of compliance in Rwanda? Second, what is the best delivery method to reach taxpayers with messages designed to improve compliance? Although other studies have explored delivery methods in the context of taxpayer communication, our study is the first one to interact these methods with different message contents. As a result, we evaluate a set of nine treatments that combine three message contents (deterrence, fiscal exchange, reminders) and three delivery methods (letters, SMS, emails) -as compared to a control group that received no message. We find that friendly approaches to taxpayers are generally more effective than deterrence. However, small taxpayers are still quite responsive to the possibility of being fined and prosecuted (deterrence). We also show that low-cost delivery methods like SMS and emails can be highly effective as compared to letters.

This paper is the first in a series of three studies looking at tax compliance using administrative data from Rwanda. It discusses the use of administrative data for tax research specifically anonymised taxpayers records, which have become increasingly available on the African continent. The paper starts by critically summarising the key advantages and disadvantages of using this data for tax research in Africa. It proceeds to illustrate these opportunities and challenges in practice, using the case of Rwanda for application of the data to analyse tax compliance and progressivity. By doing this it shows some stylised factsfor example that tax systems designed to be progressive can still be regressive in practice, that a great share of tax revenue is generated by a few very large taxpayers, and that some taxpayers face a negligible probability of being audited. Although these results are specific to Rwanda, they are in line with the situation in other low-income countries in Africa.

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This paper examines in depth one of the potential causes of the low performance of foreign aid; in particular, the role incentive structures within international donor agencies could play in leading to 'a push' to disburse money. This pressure to disburse money is termed as the 'Money-Moving Syndrome' (MMS). The theoretical analysis in this paper relies on the principal-agent theory to explore how donor agencies' institutional incentive systems may affect the characteristics of an optimal and efficient incentive contract and thus give rise to the MMS. The basic framework of the principal-agent theory was innovatively adapted to fit the organizational settings of donor agencies. The model concludes that the extent to which a performance measure based on the amount of aid allocated within a specific period of time would lead to the MMS and affect aid effectiveness depends on the level of 'institutional imperatives', the degree of aid agency's accountability for effectiveness, the level of corruption in recipient countries and the degree of difficulty to evaluate development activities.