15:00 - 16:40
P9-S232
Room: 0A.10
Chair/s:
Dan Butler
Discussant/s:
Catherine De Vries, Saad Gulzar, Gianmarco Leon-Ciliotta
PE Representation: Pay-to-Play: Campaign Contributions and Kickbacks in Public Procurement
P9-S232-5
Presented by: Saad Gulzar
Saad Gulzar
Princeton University
We explore the relationship between political donations and the allocation of public procurement contracts across multiple local elections in Colombia. By linking the universe of public contractors and the mandatory report of political donations by individuals and firms, our reduced form results demonstrate a long-term distortion in the contract allocation process attributable to political donations: (1) Contractors who donate to political campaigns are more likely to be awarded contracts, often of greater value, than those who do not. (2) These donor contractors tend to continue receiving public contracts even after losing direct political connections in subsequent election cycles, suggesting that their donations grant them extended access beyond immediate reciprocation. (3) Pointing to potential inefficiencies, we find that contracts secured by donor contractors frequently exceed budgetary limits and tend to benefit riskier firms and inexperienced individuals. Building on these results, we conduct a Randomized Control Trial (RCT) in collaboration with investigative journalists, NGOs, and the Office of the Inspector General in Colombia to study how new mayors respond to deterrence messages about contract scrutiny for their donors. Using this intervention, we estimate a structural model to rationalize the reduced form results and evaluate counterfactual policies aimed at reducing the influence of political contributions on procurement outcomes.
Keywords: Money in Politics

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