Agency Design, Favoritism and Procurement in the United States

Dahlström, C., Fazekas, M., & Lewis, D. E. (2019). Agency Design, Favoritism and Procurement in the United States. QoG Working Paper Series 2019:4, ISSN 1653-8919.

The U.S. federal government spends huge sums buying goods and services from outside of the public sector. Given the sums involved, strategic government purchasing can have electoral consequences. In this paper, we suggest that more politicized agencies show favoritism to entrepreneurs in key electoral constituencies and to firms connected to political parties. We evaluate these claims using new data on United States government contracts between 2003 and 2015. We find that executive departments, particularly more

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Auction Length and Prices: Evidence from Random Auction Closing in Brazil

Oliveira, A., Fabregas Masllovet, A. & Fazekas, M. (2019). Auction Length and Prices : Evidence from Random Auction Closing in Brazil (English). Policy Research working paper; no. WPS 8828. Washington, D.C.: World Bank Group. 

Electronic reverse auctions are the most used competitive method for procurement of goods and non-consulting services by the Federal Government of Brazil. These auctions are closed randomly, which perfectly satisfies fairness considerations but may be suboptimal from an efficiency perspective. There are concerns that tenders are closed too early and randomness favors bidders with algorithmic bidding software, leading to high prices. Hence, this paper investigates what …

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Analytics for Integrity: Enhancing Integrity Risk Assessments through Data-Driven Approaches

OECD (2019). Analytics for Integrity: Enhancing Integrity Risk Assessments through Data-Driven Approaches. Available at: https://www1.oecd.org/gov/ethics/analytics-for-integrity.pdf

Effective risk management in infrastructure projects relies on strategic and robust risk assessments in order for managers to identify risks and adapt controls to mitigating them. Risk assessments are often qualitative, relying on observations of employees and experts involved in the projects. To complement these perception-based approaches, those responsible for managing risks in infrastructure—project managers, procurement officials and risk managers—can take advantage of data analytics to further isolate risks and ensure they calibrate control activities appropriately. Doing so, requires investments and planning, and avoiding ad …

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Objective corruption risk indicators that use donor project and contract data

Fazekas, M. & Márk, L. (2017). Objective corruption risk indicators using donor project and contract data. GTI-R/2017:02, Budapest, Government Transparency Institute, September 2017.

To validate our red flags we use macro level perception-based indicators and test if these move together with the country-level averages of our red flags. We also try to find testable micro level relationships either on contract- or project-level data and check if different red flags are consistent with each other. The three donors largely differ in the range of available variables and red flags. World Bank data is the richest, while we have much more limited

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Social capital predicts corruption risk in towns

Wachs, J., Yasseri, T., Lengyel, B., Kertész, J. (2019). Social capital predicts corruption risk in towns. Royal Society Open Science 6: 182103. http://dx.doi.org/10.1098/rsos.182103

Corruption is a social plague: gains accrue to small groups, while its costs are borne by everyone. Significant variation in its level between and within countries suggests a relationship between social structure and the prevalence of corruption, yet, large-scale empirical studies thereof have been missing due to lack of data. In this paper, we relate the structural characteristics of social capital of settlements with corruption in their local governments. Using datasets from Hungary, we quantify corruption risk …

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