Survey Pre-Registration for a Project on Transaction Costs and Managerial Decision-Making in Federal Grant Acquisition

This pre-registration was originally uploaded to the Harvard Dataverse on October 7, 2025. Due to technical issues, the document was not published and was removed from the Harvard Dataverse without the authors' knowledge. This pre-registration document was not altered or edited in any way between October 7, 2025 and November 3, 2025, when it was eventually published on the Open Science Framework. Prior to submitting an article using the data from this survey experiment, the authors realized the need to upload the document as a registration on OSF rather than a project in order to ensure anonymity. Following publication, the identifiable pre-registration, with proof of the original pre-registration publication to the Harvard Dataverse, will be made public. For the purposes of the review process, this anonymized version is the only current version available. The pre-registration document was not altered in any way except for removing author names between October 7, 2025 and March 12, 2026 when this anonymized version was published. Description of the Study Grantors face tradeoffs in the design of grant programs. Under the typical dyad of grant program models in which grant awards are either allocated based on formulaic determinations of eligibility and funding amounts that prioritize need or through a competitive review of an applicant pool, the latter of which largely dominates federal and state grantmaking in the United States, governments must often prioritize either accountability—taken to mean grantees demonstrating the capacity to achieve and report on effectiveness and efficiency goals—or social equity (Collins & Gerber, 2006, 2008). This conflict lies in a widespread tendency for the grant awards to disfavor organizations that serve populations with increased need while favoring those with greater administrative capacities (Collins & Gerber, 2006, 2008; Dull and Wernstedt, 2010; Lee, 2021; Sprague et al., 2019). This “local capacity bias” raises equity concerns over the administrative capacity requirements for navigating the transaction costs of grant acquisition and suggests that areas most in need of grant funds are least equipped to acquire them (Aldag, 2025; Collins et al., 2016; Collins & Gerber, 2006, 2008; Lowe et al., 2016; Sprague et al., 2019). Organizations that might better serve the social equity goals of grant programs (particularly those that are redistributive) tend to not receive grant funding as often under competitive allocation processes, as these organizations tend neither to have the capacity to communicate effectively through complex and technical application documents nor to commit to the reporting standards required by competitive grant processes (Collins et al., 2016). A tension between social equity and accountability therefore arises. Recognizing this, scholars of public finance are keenly interested in strategies for balancing both accountability and social equity in grant administration, including institutional reforms to grant allocation processes (e.g., Collins & Gerber, 2008; Sprague et al., 2019). Yet, behavioral insights from managers remain largely unincorporated in this literature (Aldag, 2025), leaving open questions about how managerial preferences shape organizational decision-making in grant acquisition. Biases against needs-based allocation may yet persist in institutional grant allocation models that balance both accountability and social equity if the organizations that serve populations with greater needs are disincentivized to apply for a grant due to transaction costs associated with grant application and monitoring requirements. Much like grantors face tradeoffs in the allocation of resources, grantees face tradeoffs in the acquisition of those resources (Froelich, 1999). Mission drift, the inability to meet the requirements of contracts, the ethics of accepting certain gifts, and a host of other factors often force public and nonprofit managers to forego funding opportunities they would otherwise pursue (Bennett & Savani, 2011; Jones, 2007; Volden, 2007). These tradeoffs occur in both government agencies and nonprofit organizations—which are both important instruments through which grant programs achieve their desired outcomes (Beam & Conlan, 2002)—and they can determine the programs and services that are available to the public. One common tradeoff regularly confronted by public managers is that between the transaction costs associated with grant funds and the value of those funds to the organization (Volden, 2007). This reality begs a question with implications for the social equity and accountability of public services delivered via fiscal federalism: when do transaction costs in competitive grant accountability structures deter the pursuit of grant funding? This question draws on the perspectives of grantees and potential applicants in its approach to concerns over the equity- accountability tradeoffs in grant programs. Using an innovative experimental within-subjects design, we estimate the willingness of managers to accept an obligation to navigate red tape in exchange for larger awards or alternative accountability mechanisms (i.e., different kinds of transaction costs) using a sample of both nonprofit and local government managers. The experimental design will use within-subject controls, allowing us to rely on a small sample size (n=400) for a robust analysis of this question. We will manipulate three treatments—the size of a grant, the complexity of the grant application requirements, and the frequency of the grant’s reporting requirements—to explore the decisions that public managers make when forced to tradeoff absorbing transaction costs and acquiring financial resources. This project contributes to a broader discussion around balancing accountability and equity in public services delivered through fiscal federalism. The study aims to illuminate policy levers available to bureaucrats who design and administer grant programs and show to what extent accountability mechanisms (i.e., application complexity and reporting requirements) discourage nonprofit and government managers from applying for grant funding. Incorporating behavioral insights into this discourse offers both theoretical and practical implications for balancing accountability and social equity goals—conceptualized as increased willingness of lower- capacity organizations to apply for federal grant dollars—in grant design and management.