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Controlling Corruption in Development Aid: New Evidence from Contract-Level Data
Liz David-Barrett (University of Sussex) and Mihály Fazekas
Due to technical problems, this episode only includes the first half of the presentation. We would like to apologise and direct interested listeners to the working paper on which the presentation was based:
https://www.sussex.ac.uk/webteam/gateway/file.php?name=scsc-working-paper-no-1.pdf&site=405
Following scandals about corruption in foreign aid, and in a political climate that increasingly questions the legitimacy of development assistance, donors are under pressure to control how their funds are spent. At the same time, they also face pressure to trust recipient governments to disburse project funds themselves, so as to build capacity in developing countries. This paper assesses under which conditions donor regulations are successful in controlling corruption in aid spent by national governments through procurement tenders. By mining procurement contracts funded by the World Bank in 100+ countries over the period 1998-2008 for corruption “red flags”, we create a dataset that provides an unprecedentedly accurate picture of corruption risks in the spending of aid across the developing world. Through propensity score matching and regression analysis, we find that the 2003 World Bank regulatory reform aiming to control corruption was effective in reducing corruption risks: lowering single bidding on competitive markets by 3.8-4.3 percentage points. This effect is greater in countries with low state capacity.
Speaker biography:
Dr Liz David-Barrett is Deputy Director of the University of Sussex Centre for the Study of Corruption and Senior Lecturer in Politics. Her work focuses on the government-business interface, particularly on corruption risks arising from this relationship, including bribery, favouritism in procurement, lobbying and the revolving door. She also researches anti-corruption tools and is particularly interested in how international tools influence national politics.
Dr Mihály Fazekas has been pioneering the use of ‘Big Data’ for social sciences research, especially for measuring and analysing corruption and administrative quality across Europe. He uses mixed research methods while working in interdisciplinary teams of IT specialists, practitioners, and social scientists in order to collect, structure, and clean large administrative datasets generated by governments. One of his primary areas of work is public procurement and high-level corruption.
This event is organised by the Anti-Corruption Evidence Research Consortium (ACE) as part of the Economics Department seminar series held at SOAS. Visit our website programme for more information (www.ace.soas.ac.uk)
Event Date: 10 January 2018
Released by: SOAS Economics Podcast
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Liz David-Barrett (University of Sussex) and Mihály Fazekas
Due to technical problems, this episode only includes the first half of the presentation. We would like to apologise and direct interested listeners to the working paper on which the presentation was based:
https://www.sussex.ac.uk/webteam/gateway/file.php?name=scsc-working-paper-no-1.pdf&site=405
Following scandals about corruption in foreign aid, and in a political climate that increasingly questions the legitimacy of development assistance, donors are under pressure to control how their funds are spent. At the same time, they also face pressure to trust recipient governments to disburse project funds themselves, so as to build capacity in developing countries. This paper assesses under which conditions donor regulations are successful in controlling corruption in aid spent by national governments through procurement tenders. By mining procurement contracts funded by the World Bank in 100+ countries over the period 1998-2008 for corruption “red flags”, we create a dataset that provides an unprecedentedly accurate picture of corruption risks in the spending of aid across the developing world. Through propensity score matching and regression analysis, we find that the 2003 World Bank regulatory reform aiming to control corruption was effective in reducing corruption risks: lowering single bidding on competitive markets by 3.8-4.3 percentage points. This effect is greater in countries with low state capacity.
Speaker biography:
Dr Liz David-Barrett is Deputy Director of the University of Sussex Centre for the Study of Corruption and Senior Lecturer in Politics. Her work focuses on the government-business interface, particularly on corruption risks arising from this relationship, including bribery, favouritism in procurement, lobbying and the revolving door. She also researches anti-corruption tools and is particularly interested in how international tools influence national politics.
Dr Mihály Fazekas has been pioneering the use of ‘Big Data’ for social sciences research, especially for measuring and analysing corruption and administrative quality across Europe. He uses mixed research methods while working in interdisciplinary teams of IT specialists, practitioners, and social scientists in order to collect, structure, and clean large administrative datasets generated by governments. One of his primary areas of work is public procurement and high-level corruption.
This event is organised by the Anti-Corruption Evidence Research Consortium (ACE) as part of the Economics Department seminar series held at SOAS. Visit our website programme for more information (www.ace.soas.ac.uk)
Event Date: 10 January 2018
Released by: SOAS Economics Podcast