Public procurement in law and practice

Erica Bosio, Simeon Djankov, Edward Glaeser and Andrei Shleifer

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We examine a new dataset of public procurement laws, practice, and outcomes in 187 countries. We measure regulation as restrictions on the discretion of the procuring entities. We find that laws and practice are highly correlated with each other across countries, and better practice is correlated with better outcomes, but laws themselves are not correlated with outcomes. A closer look shows that stricter laws correlate with improved outcomes, but only in countries with low public sector capacity. We present a model of procurement in which both regulatory rules and public sector capacity determine procurement outcomes. In the model, regulation is effective in countries with low public sector capacity, but not in countries with high capacity because it inhibits the socially optimal exercise of discretion to exclude low quality bidders. (JEL D73, H11, H57, K12, K42, O17)

JEL-codes: D73 H11 H57 K12 K42 O17 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2022-04-01
New Economics Papers: this item is included in nep-law and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Published in American Economic Review, 1, April, 2022, 112(4), pp. 1091 - 1117. ISSN: 0002-8282

Downloads: (external link)
http://eprints.lse.ac.uk/115158/ Open access version. (application/pdf)

Related works:
Journal Article: Public Procurement in Law and Practice (2022)
Working Paper: Public procurement in law and practice (2020)
Working Paper: Public Procurement in Law and Practice (2020)
Working Paper: Public Procurement in Law and Practice (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:115158

Access Statistics for this paper

More papers in LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library LSE Library Portugal Street London, WC2A 2HD, U.K.. Contact information at EDIRC.
Bibliographic data for series maintained by LSERO Manager ().