Digital intermediaries, market competition, and citizen‐state interactions.

Can market competition between intermediaries improve the quality of citizen‐state interactions? I test this question in the context of a public‐private partnership (PPP) policy that created a network of digital intermediaries ‐ individuals authorized by the state to submit online applications on behalf of citizens. I use the overtime and staggered expansion of the intermediary network to identify the relationship between greater competition among digital intermediaries for the share of citizen applications and the quality of citizen‐state interactions. I find that having an increased presence of intermediaries in a jurisdiction does not improve the citizen experience in engaging with the state. Why doesn't an increase in the presence of intermediaries positively impact the quality of citizen‐state interactions? I argue that digital intermediaries selected by the state have limited incentives to compete in the market for citizen applications. To establish the incentives of digital intermediaries, I juxtapose their functioning against informal intermediaries, who submitted paper‐based applications before the state moved citizen applications online. Based on qualitative interviews and data on the transition from paper‐based to online applications, I show that the PPP policy by formalizing the citizen‐state interface disrupts informal mediation arrangement and limits market competition. The lack of relationship between the expansion of the intermediary network and the quality of citizen‐state interactions has important implications for how low and middle‐income countries deploy information technology for digitizing citizen interfacing governance processes. I conclude by outlining how formalization of citizen‐state interface can be implemented in a manner that can improve citizen experience engaging with the state. [ABSTRACT FROM AUTHOR]