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Can Electronic Procurement Improve Infrastructure Provision? Evidence from Public Works in India and Indonesia

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Listed:
  • Sean Lewis-Faupel
  • Yusuf Neggers
  • Benjamin A. Olken
  • Rohini Pande

Abstract

This paper examines whether electronic procurement (e-procurement), which increases access to information and reduces personal interactions with potentially corrupt officials, improves procurement outcomes. We develop unique datasets from India and Indonesia and use variation in adoption of e-procurement within both countries. We find no evidence of reduced prices but do find that e-procurement leads to quality improvements. In India, where we observe quality directly, e-procurement improves road quality, and in Indonesia, e-procurement reduces delays. Regions with e-procurement are more likely to have winners come from outside the region. On net, the results suggest that e-procurement facilitates entry from higher quality contractors.

Suggested Citation

  • Sean Lewis-Faupel & Yusuf Neggers & Benjamin A. Olken & Rohini Pande, 2016. "Can Electronic Procurement Improve Infrastructure Provision? Evidence from Public Works in India and Indonesia," American Economic Journal: Economic Policy, American Economic Association, vol. 8(3), pages 258-283, August.
    • Handle: RePEc:aea:aejpol:v:8:y:2016:i:3:p:258-83
    Note: DOI: 10.1257/pol.20140258
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • H57 - Public Economics - - National Government Expenditures and Related Policies - - - Procurement
    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O22 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning

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