Publicity Requirements in Public Procurement: Evidence from a Regression Discontinuity Design
Speaker : Decio Coviello (HEC Montreal)
Authors : Decio Coviello and Mario Mariniello
Abstract : We document whether and how publicizing a public procurement auction causally a ffects entry and the costs of procurement. We run a regression discontinuity design analysis ona large database of Italian procurement auctions. Auctions with a value above the threshold must be publicized in the Regional O cial Gazette and two Provincial newspapers. We nd that the increased publicity requirement induces more entry and higher winning rebates, which reduces the costs of procurement and rationalizes public spending. The evidence suggests that the number of bidders is the channel through which publicity a ffects rebates. Increased publicity also selects diff erent winners: it increases the likelihood that the winner hails from outside the region of the public administration and that the winner is a large company. Such companies tend to win repeated auctions gaining market share. Publicity seems to have no adverse eff ect on the ex-post renegotiations of the works, as measured by the percent of works delivered with delay or that are subcontracted. Estimates are robust to alternative measures of publicity, alternative model specifi cations, di fferent sample selections ,to a falsifi cation analysis at simulated thresholds and to the possibility that fi rms learn about auctions from a web-based for-pro fit information provider.
Download the paper : Publicity Requirements in Public Procurement:Evidence from a Regression Discontinuity Design – Coviello and Mariniello (WP 2013)