Rajasthan matters in the book as the setting for a practical test of a larger claim: when institutions sustain a public-service failure, a well-designed local incentive may be unable to repair it. In Udaipur district, a scheme to monitor nurses’ attendance briefly improved their presence at government facilities, but local health administrators undermined it, revealing that the obstacle was not simply a lack of technical solutions.

Setting and the health-care problem

The episode takes place in Udaipur district, in Rajasthan, where government health care was formally available and inexpensive, and staff were generally qualified. Yet even very poor residents often chose more expensive, unregulated private providers. The book attributes that choice to the practical unavailability of public care: facilities were frequently closed, and patients could find neither nurses nor access to the buildings.

This gap between official provision and actual access made absenteeism more than a minor administrative defect. A service could exist on paper while remaining inaccessible to the people it was supposed to serve. The case therefore begins with a visible failure of delivery, but the account asks whether that failure can be understood—and changed—at the level of local institutional incentives.

The attendance scheme

In 2006, the nongovernmental organization Seva Mandir worked with economists to encourage nurses to attend work. They introduced time clocks that stamped the date and time when nurses were at a facility. Nurses were expected to stamp their time cards three times each day, creating a record intended to show whether they arrived on time, remained at work, and left on time.

The intervention initially produced a sharp increase in attendance. Its design offered a concrete way to monitor presence and, in principle, to improve both the availability and quality of care. But the early gain did not last: in a little more than a year, attendance returned to its usual low level.

Administrative resistance and failure

The reversal came through local administrative action. The district health administration increased the number of officially sanctioned “exempt days,” even though nurses were not actually present. Time clocks were also increasingly reported as broken. Seva Mandir could not replace them because local health ministers would not cooperate.

The book treats these developments as deliberate obstruction rather than as a problem of insufficient information. Time clocks were already a familiar practice, including in Indian industry; the scheme’s basic logic was not an obscure innovation that health administrators had simply failed to imagine. Instead, administrators and nurses were described as aligned in the absenteeism system. They did not want a monitoring arrangement that would compel attendance or reduce nurses’ pay for not showing up.

Significance for institutional reform

The Rajasthan case distinguishes a technical fix from a reform that can survive the politics of the institution it is meant to change. The attendance scheme could briefly alter behavior, but the local administration had the capacity to neutralize it through exemptions, noncooperation, and the failure to maintain the clocks. The mechanism’s simplicity did not protect it from those with an interest in preserving the existing arrangement.

The episode consequently serves as a small-scale illustration of the book’s wider argument about extractive institutions: the structures that produce a persistent failure may also block attempts to correct it. Advice directed at a particular market or service failure can therefore prove ineffective when it leaves the underlying distribution of power and incentives untouched. Rajasthan’s health-care example ends not with a successful technical remedy, but with the return of absenteeism and a warning that institutional causes must be confronted for local improvements to endure.