DATE: Tuesday, 13th February 2018
VENUE: Kankam Twum-Barima Seminar room, ISSER
Mismanagement in procurement is common in many countries, including Ghana, and can severely undermine development. This study analyses public procurement practices within local governments in Ghana. Governments in developing countries typically spend over half of their budgets purchasing goods and services from private companies (World Bank, 2016). Such high levels of spending ensure that measuring the extent of financial misconduct and analysing the motivation politicians and bureaucrats have to distort procurement processes is essential to the promotion of economic development. Common modes of malfeasance include public officials selecting contractors on the basis of personal or partisan connection or receiving kickbacks from firms in return for contracts. In each case, elites have little incentive to monitor contractors. Without monitoring, companies may be inclined to construct public infrastructure using poor quality materials or not begin building at all. It is often argued that ensuring that politicians have tools to oversee bureaucrats can reduce administrative malfeasance. In contrast to this commonly held view, I theorize that tools of political oversight can impair governance and increase corruption in settings where politicians are only weakly held to account by the electorate. In such contexts, politicians can use their ability to control bureaucrats to extract rents from the state. Using data from an original survey of bureaucrats (N=864) across 80 local governments in Ghana, I show that bureaucrats are more likely to facilitate politicians’ corrupt behaviour when politicians are empowered with higher levels of discretionary control. Using qualitative data and a list experiment to demonstrate the mechanism, I show that bureaucrats agree that politicians threaten to transfer them to undesirable locations should they attempt to thwart corrupt practices. My findings provide new evidence on the sources of public administrative deficiencies in developing countries and qualify the presumption that greater political oversight improves the operation of the public sector.