Rural development cooperative audit transparency and member exit in Tanzania: a regression-discontinuity analysis of mandatory external audit thresholds

Mandatory external audit thresholds are widely used to govern rural development cooperatives, and member exit is frequently interpreted as evidence that audit transparency at the threshold changes member behaviour. the present analysis treats that interpretation as a design problem rather than a substantive finding. It characterises the operating characteristics of a regression-discontinuity design that would exploit the mandatory external audit threshold, using a before-after-control-impact estimator under a declared variance structure with an intraclass correlation of 0.64, a between-cluster standard deviation of 6.0 and a residual standard deviation of 4.5. Power was estimated across 2000 replications per design cell for cluster counts of 8, 16, 24 and 32 and effect sizes of 3, 5 and 8 percentage points. The analysis indicates that 54 clusters are required to detect a 5 percentage point effect at 80 per cent power, a requirement that exceeds the largest cluster count examined. Minimum detectable effects at 80 per cent power remain large at every cluster count considered. The contribution is a bounded methodological result: threshold-based claims about audit transparency and member exit in Tanzanian rural cooperatives cannot be sustained at the cluster counts typically available, and the regression-discontinuity estimand must be distinguished from the behavioural mechanism it is often taken to reveal.