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Favouritism and Inefficiency in Procurement: Evidence from Public Works in Italy

Author

Listed:
  • Francesco Decarolis

    (Boston University - Department of Economics.)

  • Cristina Giorgiantonio

    (Bank of Italy - Structural Economic Analysis Department.)

Abstract

This paper shows how favoritism in public procurement can emerge despite the use of rigid procedures for awarding contracts and of transparent criteria for allowing firms to bid. The paper analyzes data on the awarding of public works in Italy to illustrate how differences in fine regulation details across Italian local administrations have major implications in terms of favoritism toward local contractors and the overall efficiency of the procurement process. The findings are a cautionary tale about the benefits and risks of a decentralized procurement regulation and a warning about the problems facing green and innovation procurement.

Suggested Citation

  • Francesco Decarolis & Cristina Giorgiantonio, 2013. "Favouritism and Inefficiency in Procurement: Evidence from Public Works in Italy," Rivista di Politica Economica, SIPI Spa, issue 2, pages 161-189, April-Jun.
    • Handle: RePEc:rpo:ripoec:y:2013:i:2:p:161-189
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    Citations

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    Cited by:

    1. Cavalieri, Marina & Cristaudo, Rossana & Guccio, Calogero, 2019. "On the magnitude of cost overruns throughout the project life-cycle: An assessment for the Italian transport infrastructure projects," Transport Policy, Elsevier, vol. 79(C), pages 21-36.
    2. Audinga Baltrunaite & Cristina Giorgiantonio & Sauro Mocetti & Tommaso Orlando, 2021. "Discretion and Supplier Selection in Public Procurement [Formal and Real Authority in Organizations]," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 37(1), pages 134-166.
    3. Massimo Finocchiaro Castro & Calogero Guccio, 2021. "Does greater discretion improve the performance in the execution of public works? Evidence from the reform of discretionary thresholds in Italy," Working papers 108, Società Italiana di Economia Pubblica.
    4. Francesco Decarolis & Cristina Giorgiantonio, 2014. "Qualificazione, aggiudicazione e subappalti nei lavori pubblici: cosa insegnano le riforme locali?," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2014(1), pages 28-64.

    More about this item

    Keywords

    infrastructure; auctions; regulation.;
    All these keywords.

    JEL classification:

    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L90 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - General

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