Grain inflation: Identifying agent discretion in response to a conditional school nutrition program

Many incentive programs rely on local agents with significant discretion to allocate benefits. We estimate the degree of discretion exercised by teachers within a conditional transfer program designed to improve nutrition and encourage student attendance in Mumbai, India. The program allocates grain to students every month their attendance exceeds 80%, creating an incentive for teachers to inflate attendance to benefit certain students. We find that teachers manipulate students' records, altering the incentives to attend school. The teachers' response also varies across students. Teachers inflate more for girls, better students, and students from lower castes, but less for Muslim students.