Corruption and instutitions: An analysis for the Colombian case

Nicolás Ronderos Pulido; Alexander Cotte Poveda; Jorge Enrique Martínez Carvajal

doi:10.1016/j.heliyon.2020.e04874

Corruption and instutitions: An analysis for the Colombian case

Heliyon. 2020 Sep 18;6(9):e04874. doi: 10.1016/j.heliyon.2020.e04874. eCollection 2020 Sep.

Authors

Nicolás Ronderos Pulido¹, Alexander Cotte Poveda², Jorge Enrique Martínez Carvajal²

Affiliations

¹ Universidad Santo Tomas, Carrera 9 No 51-11, Bogotá, Colombia.
² Faculty of Economics, University Santo Tomas, Carrera 9 No 51-11, Bogotá, Colombia.

Abstract

This paper identifies the main determinants of errors in the allocation of spending by the Colombian Government. Using information from the Electronic Public Procurement System (SECOP), the determinants of the probability of an addition to a contract are identified. The errors of the government can be interpreted as an approximation of their corruption. The average income and educational level of a colombian department are found to directly influence the probability of an addition. Using the estimation of the binary choice models, the forecast error of an addition is estimated, it is found that public and civil works contracts have more forecast error, forming an ideal mechanism for thefts and accumulation of bribes. Our results show that predicting an addition can be done with high certainty.

Keywords: Behavioral economics; Binary choice; Corruption; Econometrics; Economic development; Economics; Government; Microeconomics.