Bureaucratic Discretion and Contracting Outcomes

58 Pages Posted: 14 Oct 2020

See all articles by Matthew Boland

Matthew Boland

Saint Mary's University

David Godsell

University of Illinois at Urbana-Champaign

Date Written: July 16, 2020

Abstract

We find that federal bureaucrats award more, larger, and less risky contracts to politically connected firms when they have greater discretion over contracting outcomes. Using a sample of 4.3 million federal government contract actions obligating $2.47 trillion between 2000 and 2015, we show that this result varies predictably across contract and agency characteristics, over time, and in placebo tests, and is robust to a comprehensive fixed effect structure and seven alternate measures of political connectedness. Our evidence illustrates the overlooked role of the bureaucrat in facilitating political bias in federal contracting outcomes.

Keywords: government spending, monitoring and control, corporate political activity, procurement contracts

JEL Classification: D72, D73, G38, H5, M48

Suggested Citation

Boland, Matthew and Godsell, David, Bureaucratic Discretion and Contracting Outcomes (July 16, 2020). Accounting, Organizations and Society, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3680800

Matthew Boland

Saint Mary's University ( email )

Sobey Building 311
923 Robie Street
Halifax, Nova Scotia B3H 3C3
United States

David Godsell (Contact Author)

University of Illinois at Urbana-Champaign ( email )

Champaign, IL 61820
United States
1.217.300.0844 (Phone)

HOME PAGE: http://https://giesbusiness.illinois.edu/profile/david-godsell

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
25
Abstract Views
176
PlumX Metrics