Santa Cruz, Bolivia, then and now
This week, I am heading to Santa Cruz de la Sierra, Bolivia, for the 2015 LACEA meeting. Great opportunity to meet the best Latin American researchers, as well as many good friends.
Now, this year also brings me back to 1991, when I last visited the beautiful city of Santa Cruz, as the above picture proves.
At the time, I was living in Paraguay, working for the catholic NGO Kolping Paraguay, and I went to Santa Cruz to take part in the Latin American Kolping managers meeting. Below is another picture of me at the time, working (hard) in our Paraguayan office in Juan León Mallorquín, Alto Paraná. The technology has changed a little bit, but (almost) nothing else has…
SITE Academic Conference “Fighting Corruption in Developing and Transition Countries”
On August 31 and September 1, 2015, I took part in the conference “Fighting Corruption in Developing and Transition Countries” at the Stockholm School of Economics. The program of the conference, organized by the Stockholm Institute of Transition Economics (SITE) and the ASWEDE network, brougt together leading researchers across all fields of economics (and in particular development economics and procurement) contributing to the debate about corruption, its effects, and the optimal tools to fight it. Some pictures of the event can be seen here.
I presented my work with Klenio Barbosa from Sao Paulo on revolving doors in public procurement:
This paper empirically investigates the link between public officials’ experience and career path and the public procurement process. Using an unique data set covering more than 3 millions procurement contracts of medical supplies, hospital equipments and pharmaceuticals organized by Brazilian public bodies over 10 years (2000 to 2009), together with a comprehensive data set tracing individual job experience and characteristics of all public and private formal employees in the country since 1998, we identify how career paths of individuals involved as purchase administrators or working for private providers determine procurement outcomes: probability of a firm obtaining 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 match the two datasets above to systematically identify career changes in two directions. Officials may work first for a public body and then join a private supplier. Alternatively, officials may work first for a private supplier before joining a public body. When analyzing contractual outcomes at a given date, we consider both past and future movements, and all related lags.
We develop a three-tier agency model of procurement à la Laffont-Tirole (1993), in which we embed public officials’ revolving door concerns following Che (1995). We derive from it predictions on our outcomes of interest (contract going to connected firms, prices and quantity), depending on the way the official tries to enhance the probability of post agency employment in the industry. We show that in the basic model, stronger monitoring effort by public officials seeking to signal competence on the job leads to higher quantities and prices for the firms they are targeting, while lenient or collusive behavior in the form of decreased monitoring effort leads to lower quantities and prices. We then decline this model to fit the timing and direction of the revolving door relationships we observe in the data and derive corresponding predictions that we take to the data.
Relying on such data set, we show, using several types of counterfactuals, that in several instances the movements of procurement officials significantly affect procurement outcomes: volumes delivered, price paid by the government, and probability of getting procurement contracts. Interestingly, we uncover both positive effects and negative effects of revolving door individuals on the efficiency of procurement. We provide an intuitive interpretation of our results according to our theoretical framework, relating them either to potential efficiency gains of allowing movement of workers, or to potential abuses. The results point to specific policy implications related to the tolerance of revolving door practices
Hablando en la Reunión Regional sobre Sistemas de Compras Públicas en América Latina y el Caribe en Quito
Este miércoles 15 de julio, estuve hablando por videoconferencia en el panel “La innovación en las compras públicas como instrumento de desarrollo regional” de la Reunión Regional sobre Sistemas de Compras Públicas en América Latina y el Caribe, organizada por el Sistema Económico Latinoamericano y del Caribe (SELA) en la sede de la UNASUR en Quito, Ecuador.
En mi presentación, hice un breve recuento de la evidencia empírica existente sobre los mecanismos que se implementan en el marco de las compras públicas para favorecer ciertas categorías de empresas o ciertas prácticas, con el objetivo de alcanzar objetivos de política industrial.
Mi presentación puede verse aqui.
Rio procurement workshop, March 2015
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.
Forthcoming EUDN scientific meeting
Next week, the European Development network (EUDN) organizes its annual scientific workshop in Paris (sponsored by the AFD, the French Development Agency). The opportunity to bring together the community of researchers working on development related issues, and to showcase the high-quality work done in European universities and research institutions. Here is the program:
Highlights from the LACEA-LAMES conference in São Paulo
From November 20 to 22, 2014, the LACEA (Latin American and Caribbean Economic Association) and LAMES (Latin American Meeting of the Econometric Society) conference took place at the School of Economics, Business and Accounting at the University of São Paulo (FEA-USP).
I attended a few sessions, so here are my own subjective highlights on topics of my interest (I have added links to pdf versions found on the web whenever possible):
A few new empirical papers in the area of public procurement:
– Stephan Litschig (IAE, Barcelona) presented MONITORING PUBLIC PROCUREMENT: EVIDENCE FROM A REGRESSION DISCONTINUITY DESIGN IN CHILE, from an ongoing experimental project with Maria Paula Gerardino, IADB and Dina Pomeranz, Harvard University.
– Yusuf Neggers (Harvard University): CAN ELECTRONIC PROCUREMENT IMPROVE INFRASTRUCTURE PROVISION? EVIDENCE FROM PUBLIC WORKS IN INDIA AND INDONESIA (with Sean Lewis-Faupel, Wisconsin-Madison, Benjamin A. Olken, MIT; and Rohini Pande, Harvard University)
– Dimitri Szerman (PUC-Rio and Climate Policy Initiative) presented DEMAND SHOCKS AND FIRM DYNAMICS: EVIDENCE FROM WINNERS AND LOSERS IN PROCUREMENT AUCTIONS, which is joint work with Frederico Finan, University of California, Berkeley and Claudio Ferraz, PUC-Rio.
– Klênio Barbosa (São Paulo School of Economics – FGV) presented PARTY EXPERTISE, CAMPAIGN DONATION AND GOVERNMENT CONTRACTS: EVIDENCE FROM AN ELECTORAL EXPERIMENT (written with Paulo Arvate, School of Business – FGV and Eric Fuzitani, BrUsed).
Then I also attended a session on field experiments:
– Leonardo Bursztyn (UCLA Anderson) presented HOW DOES PEER PRESSURE AFFECT EDUCATIONAL INVESTMENTS? (with Robert Jensen)
– Dean Karlan (Yale) presented a paper on pricing of pharmaceuticals: TO CHARGE OR NOT TO CHARGE: EVIDENCE FROM A HEALTH PRODUCTS EXPERIMENT IN UGANDA, joint with Greg Fischer, Maggie McConnell and Pia Raffler.
Finally, I went to the superb theory session organized by Humberto Moreira:
– Alessando Pavan (Northwestern University) presented TAXATION UNDER LEARNING BY DOING: INCENTIVES FOR ENDOGENOUS TYPES (With Miltos Makris)
– David Martimort (Paris School of Economics) presented WHEN OLSON MEETS DAHL: FROM INEFFICIENT GROUP FORMATION TO INEFFICIENT POLITICAL PROCESS (with Perrin Lefebvre)
- Santa Cruz, Bolivia, then and now
- SITE Academic Conference “Fighting Corruption in Developing and Transition Countries”
- Hablando en la Reunión Regional sobre Sistemas de Compras Públicas en América Latina y el Caribe en Quito
- Desmontando la historia oficial en Paraguay: el caso de Curuguaty
- Rio procurement workshop, March 2015
- PPPs en América Latina
- October 2015
- September 2015
- July 2015
- March 2015
- February 2015
- November 2014
- August 2014
- July 2014
- June 2014
- May 2014
- April 2014
- March 2014
- February 2014
- January 2014
- December 2013
- November 2013
- October 2013
- September 2013
- August 2013
- July 2013
- June 2013
- May 2013
- April 2013
- March 2013
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- January 2013
- December 2012
- November 2012
- October 2012
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- March 2012
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- January 2012
- December 2011
- November 2011
- "America Latina" vue par Paulo Paranagua
- Better Out Than In
- Chris Blattman blog
- Dani Rodrik's weblog
- Debraj Ray's blog
- Désintox le blog
- Droits des enfants
- Eco Americano por Alejandro Rebossio
- El País Internacional Latinoamérica
- Global Anticorruption Blog
- L'interconnexion n'est plus assurée
- La lettre d'informations scientifiques et technologiques de René Trégouët
- Le blogue de Richard Hétu
- mainly macro
- Nature News blog
- Real Progress
- US election forecasts and analysis
- Vous avez dit sécurité?
- Vox – Research-based policy analysis and commentary
- Why Nations Fail
- World Bank development blogs