Governance: An International Journal of Policy, Administration, and Institutions

Community contributions are often required as part of community-driven development programs, with contributions encouraged through matching grants. However, little remains known about the impact of matching grants or the implications of requiring community contributions—also known as informal taxation. We explore this research gap through a randomized control trial of a matching grant program in Gedo region in south-central Somalia. We find that matching grants can increase informal taxation and serve as an effective means of delivering public goods. Moreover, we find that the program strengthened local government legitimacy, despite the local government playing no direct role in the program. These findings deepen our understanding of how matching grants may contribute to community-driven development in a context of weak institutional capacity, while pointing to potential complementarities between state and non-state actors in governance and service provision, formal and informal institutions, and formal and informal taxation.

Authors

Vanessa van den Boogaard

Vanessa is a Research Fellow at the ICTD and a Senior Research Associate at the Munk School of Global Affairs and Public Policy at the University of Toronto. She completed her PhD thesis on informal revenue generation and statebuilding in Sierra Leone, and has ongoing research on the topic in the Democratic Republic of the Congo and Somalia. Vanessa leads the ICTD’s new programme on civil society engagement in tax reform and co-leads the research programme on informal taxation.

Fabrizio Santoro

Fabrizio is a Research Fellow at the Institute of Development Studies, and the Research Lead for the second component of the ICTD's DIGITAX Research Programme. His main research interests relate to governance, public finance, and taxation, with a strong focus on impact evaluation methodologies and statistical analysis. He holds a PhD in Economics from the University of Sussex.
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