• Rio procurement workshop, March 2015

    Brazil

    On March 13, we had a one day workshop at IPEA in Rio (also with the support of FGV). The program was packed with exciting new work on public procurement and great presenters (including Stephan Litschig, Dimitri Szerman, Decio Coviello, André Trindade, and Klenio Barbosa), as shown in the program.

    I also presented for the very first time my ongoing work with Klenio in revolving doors in procurement, which long abstract is below:

    This paper empirically investigates the link between public officials’ experience and career path and public procurement contracts. Using an unique data set covering 10 years of procurement contracts of medical supplies, hospital equipments and pharmaceuticals organized by Brazilian public bodies, together with a comprehensive data set tracing individual job experience and characteristics, we identify how career paths of individuals involved as purchase administrators or working for private providers determine procurement outcomes: probability of a firm obtains a contract, contract value, volume, acquisition price, and awarding procedure (invited bidders, restricted bidders, electronic auction, direct purchase).
    We are particularly looking at so called “revolving door” issues. We analyze career changes in two directions, and all their potential implications. Officials may work first for a public body and then join a private supplier. In this case, we may expect “backward” distortions if this appointment is the reward for past favors to the firm, or “forward” ones if it is an investment to benefit from the contacts and knowledge of the official. Alternatively, officials may work first for a private supplier before joining a public body. Again, we may expect “backward” effects if this public job rewards past deals such as collusion, or “forward” ones if the new appointees favor the firm for which they worked previously.
    Relying on such data set, we show that in several instances the movements of procurement officials significantly affect procurement outcomes: volumes delivered, price paid by the government, type of procurement contracts used, and some measures of mismanagement. Interestingly, we uncover both positive and negative effects of revolving door individuals on the efficiency of procurement, and analyze the likely channels for these effects.

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