Mihaly Fazekas

Central European University | CEU · Department of Public Policy

Public procurement in North Macedonia amounted to 16 percent of total government expenditure in 2018, or 5 percent of gross domestic product. The country’s public procurement is also vulnerable to corruption risks, which typically push prices up, leading to overspending. To support better budget policies, this paper maps corruption and state captur...

Although green public procurement has been established as a desirable policy goal across the globe, especially in the European Union, its scope and impacts remain severely understudied. This paper provides insights into the prevalence and structure of green public procurement in Bulgaria, which is a sustainability laggard within the European Union...

In this paper, we introduce LEGDAT, a new dataset designed to address the scarcity of global, micro-level data on legislative processes, outputs, and outcomes. Compiling data from 15 countries, the dataset includes over 270,000 bills and laws, spanning from the 1990s to 2024. LEGDAT captures detailed information on bill initiators' names and affili...

Transparency reforms make government contracting more open and amenable to public scrutiny, helping to improve public spending efficiency. But they are also politically sensitive, complex and highly technical, which makes them especially difficult to implement if state capacity is weak. Our research on nine low‐ and middle‐income countries in Afric...

Laws and regulations represent a central tool for governments to achieve policy objectives, and they also represent a fundamental condition for making desirable individual and business decisions. While laws and regulations regularly have to be adapted to changing circumstances, frequent and sudden modifications indicate legislative unpredictability...

Background Increased costs in the health sector have put considerable strain on the public budgets allocated to pharmaceutical purchases. Faced with such pressures amplified by financial crises and pandemics, national purchasing authorities are presented with a puzzle: how to procure pharmaceuticals of the highest quality for the lowest price. The...

This paper fills a critical gap in the literature, providing practical insights into employing beneficial ownership data for large-scale corruption risk assessment in public procurement, with potential implications for public policy and practice. Existing literature lacks systematic evidence on using beneficial ownership (BO) data for large-scale c...

This entry gives a general introduction to the problem of corruption in public procurement. Public procurement refers to the process through which government acquires public goods and services. Given the number of resources that are allocated through this administrative procedure, it is prone to corruption by a multitude of actors. In procurement,...

Public procurement accounts for one-third of government spending across the world, while it is also particularly vulnerable to corruption. Large amounts of open administrative data enabled a rich literature on measuring corruption. However, scholarship largely focuses on structured information on government tenders, neglecting text fields which are...

This chapter describes and analyses the ways in which data analytics can be used for countering corruption in public procurement. It also discusses the main challenges for effective data-driven anti-corruption in public procurement. We propose a simple conceptual framework, which distinguishes petty and grand corruption. Depending on the type of co...

One-third of total government spending across the globe goes to public procurement, amounting to about 10 trillion dollars a year. Despite its vast size and crucial importance for economic and political developments, there is a lack of globally comparable data on contract awards and tenders run. To fill this gap, this article introduces the Global...

Collusion among economic operators increases prices, reduces product quality, and hinders innovation. Structural links can affect the incentive and ability of firms to behave competitively by facilitating collusion. We use a network-based approach to study the relationship between ownership links and bidding behavior in procurement markets. We buil...

The digitalization of national public procurement systems across the world has opened enormous opportunities to measure and analyze procurement data. The use of data analytics on public procurement data allows governments to strategically monitor procurement markets and trends, to improve the procurement and contracting process through data-driven...

Following disasters, governments need to implement a range of responses, including the procurement of essential supplies in a short time to fulfil urgent needs. Good procurement principles such as open competition and value for money may hamper timely emergency response. Therefore, emergency clauses, which allow for deviations from open competition...

Corruption poses a significant threat to development and has a disproportionate impact on the poor and most vulnerable. Government agencies struggle to identify fraud and corruption in public expenditures. Risk assessments usually rely on manual analysis and follow-up on specific complaints or anecdotes which requires substantial resources. Assessm...

This report analyses the risks entailed by the misuse of fiscal transfers from central to local governments in nine SEE countries (Bulgaria, Croatia, Hungary, Romania, Albania, Bosnia and Herzegovina, North Macedonia, Montenegro, and Serbia). Such transfers are typically a tool of equalisation policies seeking to offset disparities in the economic...

By now, most political systems around the world hold regular multiparty elections of different quality and type. However, we know relatively little about the effect of elections on corruption, especially in high-discretion, public procurement contracts implementing development aid. To address this gap in the literature, we employ unmatched comparis...

Previous research has shown that corruption risks may distort market incentives in high-risk contexts. However, there is a dearth of evidence on the potential impact of corruption in settings characterized by low corruption and high-quality institutions. Against that background, this paper delves deeper into the alleged consequences of corruption b...

One of the most widely-accepted policy goals of beneficial ownership registers is to help tackle money laundering and financial crime. In order to further this goal, this paper first identifies types of data needed to track dark money and assesses how these can be combined with beneficial ownership information. Second, it offers practical examples...

The COVID-19 pandemic has been a major emergency globally, requiring rapid responses to protect citizens' health and lives. In order to inform future emergency policies, this paper sets out to track the corruption risk impact of the COVID-19 pandemic and the policies implemented to tackle the pandemic. We adopt a mixed-methods approach, looking at...

This paper sets out to measure and analyze corruption risks, patterns of favoritism, and state capture in public procurement in Bulgaria. It draws on two main types of data: large-scale administrative data on public procurement and the list of politically exposed persons. The analysis rests on calculating individual corruption risk indicators (or r...

Our research on corruption risk assessments (CRAs) identifies three main approaches: centralised, decentralised, and transparency-oriented methodologies. Case studies from the Netherlands, Lithuania, Mexico, and Italy highlight the role of resource and institutional constraints in the choice of approach, and the importance of ensuring high-quality,...

Cartels in public procurement impose high costs on public budgets. Precisely measuring them has a prominent policy and academic importance. The literature so far used data which is not widely available, aimed to identify specific behaviours in isolation, and considered few cases to generalise from. By implication, it has not produced comprehensive...

Governments around the world spend about one-third of their budgets through public procurement systems where electronic administration of public tenders promises great benefits. However, surprisingly little is known about how, under which circumstances, and through which features electronic systems work. To address these questions, this paper looks...

Measuring corruption is indispensable for identifying effective anticorruption policies and tracking progress towards lower levels of corruption. While there is a widespread perception that researchers and policymakers lack adequate quantitative corruption indicators, we argue that in fact there is an abundance of such metrics, although gaps remain...

Russia’s ongoing war of aggression against Ukraine has intensified existing geopolitical tensions throughout 2022 and into 2023, exposing persistent rule of law deficiencies and other governance gaps in Southeast Europe (SEE-9). This in turn has spurred efforts to renew the stalled EU integration and consolidation process, which serves as the main...

Parliaments, as the political representatives of citizens, take a central role in holding government to account. Parliamentary oversight ensures government actions are scrutinised when they are still being developed, during as well as after their implementation, to ensure that they serve the needs of the public. This involves activities such as app...

Public procurement of pharmaceutical products represents a large share of countries’ health care spending. The crucial importance of pharmaceutical products has been further exposed by the COVID-19 pandemic. Inefficiencies and corruption risks in public spending on the procurement of pharmaceuticals increase medical costs and place a heavy burden o...

Public procurement represents a large portion of government expenditure, more so in developing economies. Inefficiencies in public expenditures thus place a heavy burden on society. The Water and Sanitation (W&S) sector is especially vulnerable to public procurement inefficiencies due to the capital-intensive and complex nature of large-scale proje...

What are the barriers to market entry and competition that have limited Bulgaria’s aggregate productivity growth? The productivity analysis reveals inefficient resource allocations in Bulgaria as more productive firms have lost market shares and employ less capital and labor over time. Bulgarian firms also lag their peers in innovation, and some se...

Public procurement can be highly vulnerable to corruption. This paper outlines a methodology and results in assessing corruption risks in public procurement and their impact on relative prices, using large databases on government contracts and tenders. Our primary contribution is to analyze how price differential in public procurement contracts can...

The impacts of money in US politics have long been debated. Building on principal-agent models, we test whether and to what degree companies’ political donations lead to their favoured treatment in federal procurement. We expect the impact of donations on favouritism to vary by the strength of control by political principals over their bureaucratic...

This how-to guide sets out to describe the process of developing valid and reliable indicators of political integrity for non-technical audiences. It outlines 11 distinct steps organised in four phases, encompassing the initial objective setting, through to documenting results. The guide not only offers succinct descriptions of each step, but it al...

This article presents a global database of government contracts funded by the World Bank, Inter-American Development Bank and EuropeAid, principally from the years 2000-2017. The contract-level data were directly collected from the official contract publication sites of these organisations using webscraping methods. While the source publication for...

The training manual gives a step-by-step introduction to the analytical process of large-scale public procurement datasets. First, it briefly introduces the conceptual background of a generic public procurement process, while also highlighting its potential corruption risks. Second, it presents the most important aspects of creating an appropriate...

Public procurement is a powerful tool to achieve the economic, social development, and environmental goals and its efficiency is critical to achieving these goals. While green public procurement (GPP) may have started out as an “alternative” procurement approach, it is now recognized as an essential element of modern procurement systems. A strategi...

We employ a data-driven approach to develop a composite Water Integrity Risk Index (WIRI) made up of a host of objective proxy indicators as well as survey-based measures of corruption experience to identify and assess integrity risks in the urban water and sanitation sector in selected settlements around the world. Unlike broader-scope corruption...

The report provides a detailed estimation of costs of corruption in Uganda for 2019. It considers both direct costs all those attributed to corrupt acts, and indirect costs all those that result from corrupt acts through a series of interactions in the longer term. The report also attributes the costs of corruption to different actors bearing the c...

The overall objective of the study is to generate empirical data on the cost and extent of corruption in the Education Sector Uganda that can be used for dialogue with stakeholders to inform anti-corruption policy formulation, strategies, and programs in the sector. The baseline study shall provide a basis to understand and measure if an enhanced f...

The overall objective of the study is to generate empirical data on the cost and extent of corruption in the Health Sector Uganda that can be used for dialogue with stakeholders to inform anti-corruption policy formulation, strategies, and programs in the sector. The baseline study shall provide a basis to understand and measure if an enhanced focu...

This article traces the organization of corruption in public procurement, by theoretically and empirically assessing the contribution of extra-legal governance organizations (EGO) to supporting it. Theoretically, we explore the governance role played by organized criminal groups in corruption networks, facilitating corrupt transactions by lowering...

Laws should endure and change only if assumed benefits don't materialize over time. Yet frequent modifications of laws shortly after their enactment distort this compromise between stability and change. While, Impact Assessments (IAs) are designed to improve the quality of legislation, we know little about IAs' impact on legal stability post‐enactm...

The aim of this research is to track corruption risks affecting the Romanian public procurement system during the COVID-19 emergency. We develop a composite Corruption Risk Index (CRI) to track public procurement contracting risks in Romania in the period from 2015 to 2021. We find that the emergency context exposed the procurement process to more...

In this chapter we study corruption risks in EU defense procurement. Defense procurement has long been thought to present significant potential for corruption and state capture. Using a large dataset of contracts covering nearly ten years and applying an objective corruption risk indicator, we find strong empirical support for this hypothesis. In n...

Information and Communication Technology (ICT) is often thought of as a uniformly positive tool making governments more transparent, accountable, and less corrupt. However, the evidence on it is mixed and often misunderstood. Hence, this article carries out a systematic stocktaking of ICT tools’ impact on corruption, offering a nuanced and context-...

1 This evidence paper seeks to clearly outline the benefits of open competition in public procurement, review the policies fostering it and measuring competitive outcomes in carefully selected comparable markets across a wide array of countries. Our review of evidence regarding benefits of and policies for open competition is based on high-quality...

Considering that about 15 percent of global gross domestic product flows through public procurement systems, the lack of systematic evidence on what works in this field is a major challenge for effective policy making. Hence, this paper systematically reviews the state of the evidence on major public procurement reforms and their impact on value fo...

Containing rapidly growing health care costs in the Latin American and the Caribbean region, especially amid the COVID-19 pandemic, requires an in-depth analysis of prices from a novel perspective. This paper documents hitherto understudied variations in prices paid for pharmaceuticals, equipment, and medical supplies within countries and markets....

We use methods from network science to analyze corruption risk in a large administrative dataset of over 4 million public procurement contracts from European Union member states covering the years 2008–2016. By mapping procurement markets as bipartite networks of issuers and winners of contracts, we can visualize and describe the distribution of co...

Public procurement as a major area of government spending has the potential to act as a driver for social change and sustainable development. Its strategic use has recently gained traction with two related policy movements emerging: sustainable public procurement (SPP) and open contracting (OC). This paper explores paths towards a deepened collabor...

Government contracting is crucial for defining the quality of government and public services because it amounts to about 29% of government spending. However, regional quality of government indicators, especially for public spending, are largely missing. We assess the quality of public spending by transparency, competition, efficiency and corruption...

A crucially under-documented gender gap is the difference in public procurement spending that ows to companies led or owned by men vs. women. The role of gender in public procurement is of wide interest given that public procurement represents about a third of government spending in OECD countries. As country-level gender data on labour force parti...

The U.S. federal government spends huge sums buying goods and services from outside of the public sector. Given the sums involved, strategic government purchasing can have electoral consequences. In this paper, we suggest that more politicized agencies show favoritism to businesses in key electoral constituencies and to firms connected to political...

Incoming governments sometimes abuse their power to manipulate the allocation of government contracts so as to buy loyalty from cronies. While scandals suggest such practices are relatively widespread, the extent of such partisan favoritism is difficult to measure and the conditions under which it flourishes under-theorized. Drawing on theory regar...

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 better control how their funds are spent. However, there is little evidence on precisely how to control corruption in development aid. This article assesses under which con...

This report aims to evaluate the effectiveness and fit of open contracting reforms to LMIC contexts and to provide recommendations on how and when countries should pursue open contracting reforms. This objective was broken down into the following questions on reform outcomes and reform drivers. -How advanced and comprehensive is the legal framewor...

This paper is part of a broader research project which aims to assess state capture risks in the field of defence procurement using a combination of qualitative and quantitative methods to overcome research challenges typical of this area, most of all the relatively low level of transparency due to specific procurement regulations. In this paper, w...

The importance of transparency and governance as determinants of efficiency, effectiveness, and quality of service undoubtedly occupy a key place among the most relevant lessons learned from the reforms implemented in the Water and Sanitation sector (W&S) in Latin America and the Caribbean (LAC) in the last two decades. In order to support data-dr...

We employ a data-driven approach to develop a composite Water Integrity Risk Index (WIRI) made up of a host of objective proxy indicators as well as survey-based measures of corruption experience to identify and assess integrity risks in the urban water and sanitation sector in selected settlements around the world. Unlike broader-scope corruption...

This chapter exposes the enormous opportunities presented by the emergence of Big Data in public procurement and the lack of investment and effort for exploiting these opportunities. Big Data in public procurement holds the promise of fundamentally transforming how procurement performance is understood and it can provide a vastly superior guide to...

Regulatory instability, that is frequent modification of adopted laws, is costly for society. Regulatory Impact Assessments (RIAs) are designed to improve the quality of legislation, however, we know little about RIAs' impact on legal stability. Therefore, this paper analyses whether RIAs influence the incidence and frequency of the modifications o...

Agencification has been pursued globally under the promise of increasing public administration performance. In spite of ample theoretical arguments, the empirical evidence on the causal link between agencification and performance remains scarce and methodologically contested. We contribute to this debate by empirically testing the impacts of agenci...

Progress in corruption research and anticorruption policies has been hampered by the lack of adequate measurement in at least two ways. On the one hand, shortcomings of corruption measurement limits our capacity to understand what works and hence develop effective policies. On the other hand, in the absence of sufficiently sensitive measures of cor...

supplementary appendices

Given a widespread sense among donors that mainstream anti-corruption reforms over the past 25 years have failed to yield results, there is a move towards more targeted interventions. Such interventions should, in principle, overcome implementation gaps and make it easier to evaluate impact, supporting learning. However, when interventions are narr...