Bunching below thresholds to manipulate public procurement

Bedri Kamil Onur Tas ()
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Bedri Kamil Onur Tas: College of Economics and Political Science

Empirical Economics, 2023, vol. 64, issue 1, No 12, 303-319

Abstract: Abstract Manipulative authorities can bunch tenders just below thresholds to implement noncompetitive procurement practices. I use regression discontinuity manipulation tests to identify the bunching manipulation scheme. I investigate the European Union public procurement data set that covers more than two million contracts. The results show that 10–13% of the examined authorities exhibit a high probability of bunching. These authorities are less likely to employ competitive procurement procedures. Local firms are more likely to win contracts from a bunching authority. The probability that the same firm wins contracts repeatedly is high when an authority has high bunching probability. Empirical results suggest that policy makers can effectively employ regression discontinuity manipulation tests to determine manipulative authorities.

Keywords: Public procurement; Manipulation; Competition; European union (search for similar items in EconPapers)
JEL-codes: C31 D44 H57 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s00181-022-02250-4

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