Does Transparency Inhibit Political Compromise?

Governments around the world face an apparent tension when considering whether to allow public access to the governing process. In principle, transparent institutions promote accountability and good governance. However, politicians and scholars contend that such reforms also constrain politicians' capacity to negotiate and compromise, producing inefficiency and gridlock. This argument—that transparency inhibits compromise—is widely accepted, but rarely empirically tested. We develop a theoretical framework around the claim and evaluate it in the context of American state legislatures. We leverage temporal variation in state 'sunshine law' adoptions and legislative exemptions to identify the effects of transparency on several observable indicators of compromise: legislative productivity, polarization, partisanship, policy change, and budget delay. Our analyses generally do not support the argument; we mostly report precisely-estimated negligible effects. Thus, transparency may not be the hindrance to policymaking that conventional wisdom suggests. Effective governance appears possible in state legislatures even under public scrutiny.