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Bribery and Public Procurement - An Experimental Study

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Author Info
Susanne Büchner () (Max-Planck-Institute for Economics)
Andreas Freytag () (University of Jena, Faculty of Economics)
Luis G. Gonzalez ()
Werner Güth () (Max-Planck-Institute for Economics)

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Abstract

A procurement contract is granted by a bureaucrat (the auctioneer) who is interested in a low price and a bribe from the provider. The optimal bids and bribes are derived based on an iid private cost assumption. In the experiment, bribes are negatively framed (betweensubjects treatment) to capture that society is better off if bribes are rare or low. Although bids are lower than predicted, behavior is qualitatively in line with the linear equilibrium prediction. When bribes generate a negative externality, there is a significant increase in the variability of the data.

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Paper provided by Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t in its series Jenaer Schriften zur Wirtschaftswissenschaft with number 06/2006.

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Date of creation: 15 Jan 2006
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Handle: RePEc:jen:jenasw:2006-06

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Related research
Keywords: Corruption Procurement Auctions

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This paper has been announced in the following NEP Reports: References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Yvan Lengwiler & Elmar Wolfstetter, 2000. "Auctions and Corruption," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
    Other versions:
  2. Marco Celentani & Juan J. Ganuza, 2000. "Corruption and Competition in Procurement," Economics Working Papers 464, Department of Economics and Business, Universitat Pompeu Fabra, revised Mar 2001. [Downloadable!]
    Other versions:
  3. Lien, Da-Hsiang Donald, 1986. "A note on competitive bribery games," Economics Letters, Elsevier, vol. 22(4), pages 337-341. [Downloadable!] (restricted)
  4. Compte, O. & Lambert-Mogiliansky, A. & Verdier, T., 2000. "Corruption and Competition in Public Market Auctions," DELTA Working Papers 2000-01, DELTA (Ecole normale supérieure).
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  5. Beck, Paul J. & Maher, Michael W., 1986. "A comparison of bribery and bidding in thin markets," Economics Letters, Elsevier, vol. 20(1), pages 1-5. [Downloadable!] (restricted)
  6. Roberto Burguet & Yeon-Koo Che, 2004. "Competitive Procurement with Corruption," RAND Journal of Economics, The RAND Corporation, vol. 35(1), pages 50-68, Spring.
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Wolfgang Domschke & Armin Scholl, 2006. "Heuristische Verfahren," Jenaer Schriften zur Wirtschaftswissenschaft 08/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
  2. Uwe Cantner & Andreas Meder, 2006. "Determinants influencing the choice of a cooperation partner," Jenaer Schriften zur Wirtschaftswissenschaft 20/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
  3. Armin Scholl & Nils Boysen & Malte Fliedner, 2006. "The sequence-dependent assembly line balancing problem," Jenaer Schriften zur Wirtschaftswissenschaft 18/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
  4. Jens J. Krüger & Kristina Dreßler, 2006. "Knowledge, Profitability and Exit of German Car Manufacturing Firms," Jenaer Schriften zur Wirtschaftswissenschaft 15/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
  5. Jens J. Krüger, 2006. "The Sources of Aggregate Productivity Growth - U.S. Manufacturing Industries, 1958-1996," Jenaer Schriften zur Wirtschaftswissenschaft 10/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
  6. Simon Renaud, 2006. "Works Councils and Heterogeneous Firms," Jenaer Schriften zur Wirtschaftswissenschaft 16/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
  7. Simon Renaud, 2006. "Betriebsräte und Strukturwandel," Jenaer Schriften zur Wirtschaftswissenschaft 04/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
  8. Holger Graf & Tobias Henning, 2006. "Public Research in Regional Networks of Innovators: A Comparative Study of Four East-German Regions," Jenaer Schriften zur Wirtschaftswissenschaft 19/2006, Friedrich-Schiller-Universit�t Jena, Wirtschaftswissenschaftliche Fakult�t. [Downloadable!]
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