Tenure in Office and Public Procurement

Decio Coviello () and Stefano Gagliarducci
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Decio Coviello: Faculty of Economics, University of Rome "Tor Vergata", http://www.ceistorvergata.it

No 179, CEIS Research Paper from Tor Vergata University, CEIS

Abstract: We investigate how the functioning of public procurement is affected by the time politicians have stayed in office. We match a data set on public procurement auctions by Italian municipalities to a data set on the politics of municipal governments. For each municipality, we relate the mayor’s tenure in office to several outcomes of the procurement process. The main result is that an increase in a mayor’s tenure (the number of terms in office) is associated with “worse” outcomes: fewer bidders per auction, a higher cost of procurement, and a higher probability that the winner is local and that the same firm is awarded repeated auctions. We make use of a quasi-experimental change in the electoral law (the introduction of a two-term limit) to argue that the correlation is in fact causal. Finally, we provide a simple theoretical model of repeated auctions in which these findings are consistent with time in office progressively leading to collusion between government officials and a few favored bidders.

Keywords: Tenure in office; Procurement auctions; Public works; Term limit (search for similar items in EconPapers)
JEL-codes: D44 D72 D73 H57 H70 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2010-12-21, Revised 2010-12-21
New Economics Papers: this item is included in nep-cdm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Related works:
Journal Article: Tenure in Office and Public Procurement (2017)
Working Paper: Tenure in office and public procurement (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:rtv:ceisrp:179

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