Test Matters: the Redistributive Effects of Protests on Intergovernmental Transfers

Abstract: Can citizen-led protests successfully increase redistributive efforts of governments? We study the effects of protests on redistribution under revenue sharing schemes using evidence from Nigeria. We digitized twenty-six years of public finance data from 1988 to 2016 to examine the effects of protests on intergovernmental transfers. We use new survey data to assess the links between transfers, public service provision and tax morale. The results show that protests are associated with increases in intergovernmental transfers in areas aligned with disbursing governments. Residents from areas with higher shares of revenues from transfers report lower public service provision and reduced tax morale.