Data and Code for: "Indirect Savings from Public Procurement Centralization"

Principal Investigator(s): View help for Principal Investigator(s) Clarissa Lotti, Lear; Arieda Muço, Central European University; Giancarlo Spagnolo, Site - Stockholm School of Economics; Tommaso Valletti, Imperial College London

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Name	File Type	Size	Last Modified
Indirect-Effects-Centralization-main			06/18/2024 01:16:PM

Project Citation:

Lotti, Clarissa, Muço, Arieda, Spagnolo, Giancarlo, and Valletti, Tommaso. Data and Code for: “Indirect Savings from Public Procurement Centralization.” Nashville, TN: American Economic Association [publisher], 2024. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2024-06-24. https://doi.org/10.3886/E192686V1

Project Description

Summary:

Centralization of public procurement can lower prices for the government's direct purchase of goods and services. This paper focuses on indirect savings. Public administrations that do not procure directly through a central procurement agency might benefit from the availability of centrally-procured goods. We exploit the introduction of a central purchasing agency in Italy and find that prices came down by 22% among administrations that bought autonomously.

These indirect effects appear to be driven by informational externalities, especially for less competent public buyers purchasing technologically more complex goods. Accounting for indirect savings increases the estimate of direct ones.

Funding Sources: Italian Ministry for University and Research (PRIN 2017)

Scope of Project

Subject Terms: Centralization; Informational Externalities; Public Procurement

JEL Classification:
      D44 Auctions
      H11 Structure, Scope, and Performance of Government
      H57 National Government Expenditures and Related Policies: Procurement
      H83 Public Administration; Public Sector Accounting and Audits
      L38 Public Policy
      L88 Industry Studies: Services: Government Policy

Geographic Coverage: Italy

Time Period(s): 1/1/1999 – 12/27/2007

Collection Date(s): 1/1/2003 – 12/31/2005

Universe:

Public Administrations in Italy in the 2000s.

Data Type(s): event/transaction data; observational data; survey data

Collection Notes: The survey was run by the Italian National Institute of Statistics (ISTAT) jointly with the Italian Treasury (Ministero dell'Economia e delle Finanze, MEF), with considerable resources put into the exercise.
For each public body, there was a particular person in charge of answering the questionnaire, typically the person signing procurement contracts. For all these people there are personal IDs, emails, and phone numbers in our dataset. Each person had assigned a counterpart in ISTAT ("referente ISTAT''), whose job was to check the progress until the survey was responded to properly. There was a dedicated call center and dedicated e-mail service for queries, all with the purpose of supporting filling the questionnaire. This was run by Consip and handled thousands of queries: possibly, as a consequence of this set up, the response rates were very high for this type of exercise (around 80%). Also, random samples of contracts had to be supplied to MEF. We do not know the results of this, but we think the announcement had a strong effect on telling the truth (telling a lie is prosecuted administratively, and the person in charge could lose their job). The questionnaires themselves were quite rigorous and they all had a friendly web interface to facilitate filling out the survey.
Italian Public administration were requested to keep records of their procurement purchases. They filed the questionnaires through accessing their records.

Methodology

Response Rate: 80 percent

Sampling:

The survey was distributed to a sample of PBs accounting for 80% of the expenditure

on goods and services by the Italian public sector as a whole.

Data Source: Bandiera, Oriana, Prat, Andrea, and Valletti, Tommaso. Replication data for: Active and Passive Waste in Government Spending: Evidence from a Policy Experiment. Nashville, TN: American Economic Association [publisher], 2009b. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113315V1

Collection Mode(s): mail questionnaire

Unit(s) of Observation: Transaction

Geographic Unit: Public body

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V1 [2024-06-24]

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