Assessing Vulnerabilities to Corruption in Public Procurement and Their Price Impact

By Aly Abdou, Olivier Basdevant, Elizabeth David-Barrett, Mihaly Fazekas

May 20, 2022

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Format: Chicago

Aly Abdou, Olivier Basdevant, Elizabeth David-Barrett, and Mihaly Fazekas. Assessing Vulnerabilities to Corruption in Public Procurement and Their Price Impact, (USA: International Monetary Fund, 2022) accessed December 23, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Public procurement can be highly vulnerable to corruption. This paper outlines a methodology and results in assessing corruption risks in public procurement and their impact on relative prices, using large databases on government contracts and tenders. Our primary contribution is to analyze how price differential in public procurement contracts can be explained by corruption risk factor (aggregated in a synthetic corruption risk index). While there are intrinsic limitations to our study (price differentials can come from structural reasons, such as a limited number of potential suppliers) it still provides a guiding tool to assess where corruption risks would have the biggest budgetary impact. Such analysis helps inform mitigating policies owing to the granular data used.

Subject: Corruption, Crime

Keywords: Corruption, Corruption risk, Corruption risks, Data collection methodology, Global, Price differential, Price impact, Procurement contract, Procurement cost, Public procurement

Publication Details

Pages:

31
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2022/094
Stock No:

WPIEA2022094
ISBN:

9798400207884
ISSN:

1018-5941

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