Turnover, Morale, and Performance in Bureaucracies: Evidence from Indonesian Villages

Abstract

We study how leader changes triggered by elections affect bureaucratic performance at the local level. Villages in Indonesia democratically elect a new leader every six years. Combining detailed personnel surveys with a regression discontinuity design (RDD), we show that electoral defeats of the incumbent village head increase turnover in the village bureaucracy and reduce nepotism. Bureaucrats led by new leaders are more enthusiastic about their work, more ambitious, more highly paid, and less likely to be connected to past or present village government members. They interact substantially more with village citizens and have a better understanding of their preferences. This leads to higher levels of public service provision, measured in both administrative data and surveys conducted with citizens. In spite of this, citizens’ trust in their village government remains unaffected in the short run. Our findings shed new light on the positive effects of leader turnover on bureaucratic morale and performance.