Corruption and the Network Structure of Public Contracting Markets across Government Change
Corruption is thought to affect developed economies to a greater degree than developing countries. However, given our limited capacity to detect corruption, it may simply be harder to detect it in countries with stronger institutions. This article sets out to address this measurement challenge and t...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Cogitatio
2020-05-01
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| Series: | Politics and Governance |
| Subjects: | |
| Online Access: | https://www.cogitatiopress.com/politicsandgovernance/article/view/2707 |
| _version_ | 1818493704449556480 |
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| author | Mihály Fazekas Johannes Wachs |
| author_facet | Mihály Fazekas Johannes Wachs |
| author_sort | Mihály Fazekas |
| collection | DOAJ |
| description | Corruption is thought to affect developed economies to a greater degree than developing countries. However, given our limited capacity to detect corruption, it may simply be harder to detect it in countries with stronger institutions. This article sets out to address this measurement challenge and to offer a tailored approach to one particular type of corruption: high-level corruption in government contracting. We describe a recently developed method to score procurement contracts for corruption risk. Then, using micro-level data from Hungary and the Czech Republic we analyze how corruption can distort public procurement markets, mapped as networks of buyers and suppliers. Proxying for corruption using a composite index of red flags derived from contract awards, we find that public sector buyers with high corruption risk have sparser network neighborhoods, meaning that they contract with fewer suppliers than expected. We interpret our results as evidence that corruption in procurement markets is fundamentally about the exclusion of non-favored firms. Political change has a significant effect on corrupt relationships: High corruption risk buyers with sparse neighborhoods rewire their contracting relationships roughly 20–40% more extensively than other buyers across years with government turnover. The article demonstrates how the political organization of corruption distorts market competition in OECD countries. |
| first_indexed | 2024-12-10T17:57:28Z |
| format | Article |
| id | doaj.art-49a6525791f245d4a421c11d62cd439f |
| institution | Directory Open Access Journal |
| issn | 2183-2463 |
| language | English |
| last_indexed | 2024-12-10T17:57:28Z |
| publishDate | 2020-05-01 |
| publisher | Cogitatio |
| record_format | Article |
| series | Politics and Governance |
| spelling | doaj.art-49a6525791f245d4a421c11d62cd439f2022-12-22T01:38:53ZengCogitatioPolitics and Governance2183-24632020-05-018215316610.17645/pag.v8i2.27071448Corruption and the Network Structure of Public Contracting Markets across Government ChangeMihály Fazekas0Johannes Wachs1School of Public Policy, Central European University, Hungary / School of Slavonic and East European Studies, University College London, UKChair of Computational Social Sciences and Humanities, RWTH Aachen University, GermanyCorruption is thought to affect developed economies to a greater degree than developing countries. However, given our limited capacity to detect corruption, it may simply be harder to detect it in countries with stronger institutions. This article sets out to address this measurement challenge and to offer a tailored approach to one particular type of corruption: high-level corruption in government contracting. We describe a recently developed method to score procurement contracts for corruption risk. Then, using micro-level data from Hungary and the Czech Republic we analyze how corruption can distort public procurement markets, mapped as networks of buyers and suppliers. Proxying for corruption using a composite index of red flags derived from contract awards, we find that public sector buyers with high corruption risk have sparser network neighborhoods, meaning that they contract with fewer suppliers than expected. We interpret our results as evidence that corruption in procurement markets is fundamentally about the exclusion of non-favored firms. Political change has a significant effect on corrupt relationships: High corruption risk buyers with sparse neighborhoods rewire their contracting relationships roughly 20–40% more extensively than other buyers across years with government turnover. The article demonstrates how the political organization of corruption distorts market competition in OECD countries.https://www.cogitatiopress.com/politicsandgovernance/article/view/2707corruptiongovernment changemarketsnetworkspolitical turnover |
| spellingShingle | Mihály Fazekas Johannes Wachs Corruption and the Network Structure of Public Contracting Markets across Government Change Politics and Governance corruption government change markets networks political turnover |
| title | Corruption and the Network Structure of Public Contracting Markets across Government Change |
| title_full | Corruption and the Network Structure of Public Contracting Markets across Government Change |
| title_fullStr | Corruption and the Network Structure of Public Contracting Markets across Government Change |
| title_full_unstemmed | Corruption and the Network Structure of Public Contracting Markets across Government Change |
| title_short | Corruption and the Network Structure of Public Contracting Markets across Government Change |
| title_sort | corruption and the network structure of public contracting markets across government change |
| topic | corruption government change markets networks political turnover |
| url | https://www.cogitatiopress.com/politicsandgovernance/article/view/2707 |
| work_keys_str_mv | AT mihalyfazekas corruptionandthenetworkstructureofpubliccontractingmarketsacrossgovernmentchange AT johanneswachs corruptionandthenetworkstructureofpubliccontractingmarketsacrossgovernmentchange |