Corruption in Public Procurement: Finding the Right Indicators

Joras Ferwerda; Ioana Deleanu; Brigitte Unger

doi:10.1007/s10610-016-9312-3

Corruption in Public Procurement: Finding the Right Indicators

Joras Ferwerda^*
, Ioana Deleanu
, Brigitte Unger

^*Corresponding author for this work

Criminology

Research output: Contribution to Journal › Article › Academic › peer-review

Abstract

Red flags are widely used to minimize the risk of various forms of economic misconduct, among which corruption in public procurement. Drawing on criminal investigations, the literature has developed several indicators of corruption in public procurements and has put them forward as viable risk indicators. But are they genuinely viable, if only corrupt procurements are analysed? Using a dataset of 192 public procurements — with 96 cases where corruption was detected and 96 cases where corruption was not detected — this paper addresses the identification of significant risk indicators of corruption. We find that only some indicators significantly relate to corruption and that eight of them (e.g. large tenders, lack of transparency and collusion of bidders) can best predict the occurrence of corruption in public procurements. With this paper we successfully tap into one of the most vulnerable areas of criminological research — selecting the right sample — and consequently, our results can help increase the detection of corruption, increase investigation effectiveness and minimize corruption opportunities.

Original language	English
Pages (from-to)	245-267
Number of pages	23
Journal	European Journal on Criminal Policy and Research
Volume	23
Issue number	2
DOIs	https://doi.org/10.1007/s10610-016-9312-3
Publication status	Published - 1 Jun 2017

Funding

Acknowledgments This paper is based on the research done for an OLAF-project financed by the European Commission: Wensink et al. (2013) Identifying and Reducing Corruption in Public Procurement in the EU, Project Report for the European Commission by PwC and Ecorys, with support of Utrecht University, financed by OLAF – European Anti-Fraud Office, OLAF/D6/57/2011. We are thankful for the support of all members of the research team. We would also like to thank Alina Mungiu-Pippidi for helpful comments on our research.

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 16 Peace, Justice and Strong Institutions

Keywords

Corruption
Public procurement
Selection bias and econometrics

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10.1007/s10610-016-9312-3

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Cite this

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title = "Corruption in Public Procurement: Finding the Right Indicators",

abstract = "Red flags are widely used to minimize the risk of various forms of economic misconduct, among which corruption in public procurement. Drawing on criminal investigations, the literature has developed several indicators of corruption in public procurements and has put them forward as viable risk indicators. But are they genuinely viable, if only corrupt procurements are analysed? Using a dataset of 192 public procurements — with 96 cases where corruption was detected and 96 cases where corruption was not detected — this paper addresses the identification of significant risk indicators of corruption. We find that only some indicators significantly relate to corruption and that eight of them (e.g. large tenders, lack of transparency and collusion of bidders) can best predict the occurrence of corruption in public procurements. With this paper we successfully tap into one of the most vulnerable areas of criminological research — selecting the right sample — and consequently, our results can help increase the detection of corruption, increase investigation effectiveness and minimize corruption opportunities.",

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AB - Red flags are widely used to minimize the risk of various forms of economic misconduct, among which corruption in public procurement. Drawing on criminal investigations, the literature has developed several indicators of corruption in public procurements and has put them forward as viable risk indicators. But are they genuinely viable, if only corrupt procurements are analysed? Using a dataset of 192 public procurements — with 96 cases where corruption was detected and 96 cases where corruption was not detected — this paper addresses the identification of significant risk indicators of corruption. We find that only some indicators significantly relate to corruption and that eight of them (e.g. large tenders, lack of transparency and collusion of bidders) can best predict the occurrence of corruption in public procurements. With this paper we successfully tap into one of the most vulnerable areas of criminological research — selecting the right sample — and consequently, our results can help increase the detection of corruption, increase investigation effectiveness and minimize corruption opportunities.

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KW - Selection bias and econometrics

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Corruption in Public Procurement: Finding the Right Indicators

Abstract

Funding

UN SDGs

Keywords

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