Procurement Design with Corruption

B-Tier
Journal: American Economic Journal: Microeconomics
Year: 2017
Volume: 9
Issue: 2
Pages: 315-41

Score contribution per author:

2.011 = (α=2.01 / 1 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

I investigate the design of optimal procurement mechanisms in the presence of corruption. After contracting with the sponsor, the contractor may bribe the inspector to misrepresent quality. The mechanism affects whether bribery occurs. I discuss the cases of both fixed and variable (with the size of misrepresentation) bribes, and also uncertainty about the bribe amount. In all cases, the optimal contract curtails quality for low efficiency contractors but also for the most efficient contractors. I also present models of bribe negotiations whose reduced form coincide with the model analyzed in the paper, and discuss implementation and the effect of competition.

Technical Details

RePEc Handle
repec:aea:aejmic:v:9:y:2017:i:2:p:315-41
Journal Field
General
Author Count
1
Added to Database
2026-01-25