Business corruption and inefficiencies in public procurement are pervasive in the economy, and this tends to be especially true for developing countries. Focusing primarily on the construction sector, crucial from a policy perspective, this project aims to study the potential frictions to the effectiveness of transparency and enforcement initiatives undertaken by the government in Uganda.
The primary objective is to generate a rich dataset with details of public procurement contracts, business networks, and supply chain linkages, and a variety of firm-level information. With this data, the researchers are interested in testing several information diffusion interventions and estimating their impact on the private sector.
- Thanks to a close partnership with the Uganda anti-corruption agency, researchers manually collected information on the universe of public procurement contracts in Uganda for the period 2008-2016, covering about 30,000 firms, 200,000 contracts, and 250 public entities. They complemented this data with extra details for the approximately 20,000 contracts that have been fully audited by the government during the same time period. This comprehensive dataset contains all the available information on contracts between firms and government bodies, such as contract amount, bidding firms, project description, delays and excessive implementation costs, cases of corruption and other irregularities, quality of the work performed, donor identity, etc.
- This data is then combined with several administrative datasets from the Uganda Revenue Authority (URA). Such datasets contain information on volume of business, imports and exports, and on all VAT registered transactions by all formal firms in Uganda. This allows researchers to construct the full formal network of firms for the period 2010-2016. They match this data to the procurement records thanks to the presence of tax identification numbers.
- Finally, researchers designed a detailed survey of most private sector agents doing business with the government, focusing primarily on the construction sector. This survey, currently in the field, involves more than 4,000 firms across the entire country. The surveys place special emphasis on the role of business networks and supply chain linkages among firms, and it also includes information on costs, profits, organisational structure, management practices, uncertainty, as well as perceptions about corruption and transparency in the sector.
The combination of the various datasets will then be used to (a) measure the extent of corruption, competition, informality, and tax evasion in the economy, (b) investigate the role of competition and transparency in advancing public sector efficiency, and (c) carry out a set of information interventions researchers have developed together with the government. They will then test the impact of these interventions on a variety of outcomes at both the firm and the public entity level.