Aditya Bharadwaj

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108 In practice, during the internal budgeting process, the finance bureaucrats continue to allocate budgets based on each department’s revenue. Why? One budgeting officer explained that it was a simple incentive problem: “The financial burden of our county would be too large otherwise. If we agreed to fund all the departments fully, then they would have no motivation to generate revenue for themselves.”
How China Escaped the Poverty Trap
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