Bunching below thresholds to manipulate public procurement

Bedri Kamil Onur Tas*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

Manipulative authorities can bunch tenders just below thresholds to implement noncompetitive procurement practices. I use regression discontinuity manipulation tests to identify the bunching manipulation scheme. I investigate the European Union public procurement data set that covers more than two million contracts. The results show that 10–13% of the examined authorities exhibit a high probability of bunching. These authorities are less likely to employ competitive procurement procedures. Local firms are more likely to win contracts from a bunching authority. The probability that the same firm wins contracts repeatedly is high when an authority has high bunching probability. Empirical results suggest that policy makers can effectively employ regression discontinuity manipulation tests to determine manipulative authorities.

Original languageEnglish
JournalEmpirical Economics
DOIs
Publication statusAccepted/In press - 2022
Externally publishedYes

Keywords

  • Competition
  • European union
  • Manipulation
  • Public procurement

ASJC Scopus subject areas

  • Statistics and Probability
  • Mathematics (miscellaneous)
  • Social Sciences (miscellaneous)
  • Economics and Econometrics

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