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Corrupt Reserve Prices
Ghent University, Belgium
,
2019.
Procurement auctions are often plagued by favoritism and rent-seeking behavior. We develop a new methodology to red-flag potential favoritism in public procurement auctions with reserve prices, and apply it to Russian public purchases of gasoline between 2011 and 2013. Since the reserve price is set prior to the auction, it is independent of the identity of the winning seller in a fair and competitive auction. A procurer-seller pair is therefore red-flagged as potentially corrupt if it exhibits consistently higher reserve prices than the average reserve price of this procurer. Corrupt procurers limit auction entry so that their favored sellers face less competition in these auctions and are more likely to win them. Auctions with corrupt pairs also have higher final contract prices, implying considerable welfare losses. The inflationary effect of reserve price manipulation by corrupt procurer-seller pairs on final auction prices is mitigated by higher competition and fully offset by open bid e-auctions with sufficient competition.
Publication based on the results of:
Ostrovnaya M., Elena Podkolzina, Journal of Competition Law & Economics 2015 Vol. 11 No. 2 P. 331-352
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Balsevich A. A., Pivovarova S. G., Podkolzina E., / Высшая школа экономики. Series EC "Economics". 2011. No. 01.
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Yakovlev A. A., Demidova O., Экономический журнал Высшей школы экономики 2010 Т. 14 № 2 С. 202-226
Corruption in government procurements remains to be one of grave problems in transition economies. A reaction to this problem in Russia came in 2005-2006 in form of a radical reform of government procurements. This paper analyses the main parameters of firms participating in government procurements before and after changes in regulation. Our analysis is based ...
Added: October 13, 2012
Yakovlev A. A., Demidova O., International Journal of Economic Policy in Emerging Economies 2012 Vol. 5 No. 2 P. 140-157
This paper considers the consequences of public procurement reform in Russia in 2005-2006. We show that before the reform, manufacturing firms with government stakes, old firms and larger firms had advantages in access to government orders. In 2009 large firms retain their advantages in access to government orders. Estimated scales of ‘kickback’ in 2009 were ...
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Ostrovnaya M., Podkolzina E., Экономический журнал Высшей школы экономики 2014 Т. 18 № 4 С. 586-619
Since the 2000s electronic auctions have been actively used in public and private procurement in many countries. They are often organized by intermediaries – specialized e-platforms, which seem to raise price competition between companies through increased transparency and lower participation costs. Meanwhile, it is not clear yet to what consequences e-auctions lead, if an e-platform ...
Added: October 21, 2014
Balsevich A. A., Podkolzina E., / Высшая школа экономики. Series WP BRP "Economics/EC". 2014. No. WP BRP 76/EC/2014.
Corruption is widely spread across the world and is believed to affect economic growth negatively. It is most persistent in the developing countries. Russian economy is not an exception. Significant losses are also reported in public procurement in Russia due to corruption. Unfortunately, to measure corruption is very challenging. In this paper, using the data ...
Added: November 27, 2014
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Corrupt buyers and sellers of government services often face difficulties finding each other. Their activity is illegal, so one cannot just ask: "will you take my bribe?" or "how much will you give me if I accelerate this bureaucratic procedure?" Professional intermediaries help reveal this information. Sometimes intermediaries perform some legal functions too (e. g. ...
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Tatarko A., Mironova A. A., Social Sciences 2016
Objective. This article analyses the association between personal values and the acceptability of corruption in Russia, France, Germany, and Latvia. Several studies show that cultural values can be related to the level of corruption in the countries at the societal level. We look at the following two questions: (1) Can universal personal values influence the ...
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Detkova P., Podkolzina E., Tkachenko A., International Journal of Public Administration 2018 P. 414-434
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Oxford : Oxford University Press, 2011
Beer was the drink of choice in many ancient societies and throughout the past centuries in large parts of the world. Right now, it is globally by far the most important alcoholic drink, in volume and value terms. The largest brewing companies have developed into global multinationals. The beer market is characterized by strong growth ...
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Urban environment quality and quality of living patterns are the key factors for Russian cities’ competitiveness increase. They both are to a large extent driven by the housing economy characteristics. The article provides analysis of basic trends in housing economy of Russian cities including:
• housing consumption;
• structure of housing and ownership rights;
• housing price dynamics ...
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НИУ ВШЭ, 2020
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