DOES CORRUPTION SAND THE WHEELS IN THE PUBLIC WORKS EXECUTION?

This paper investigates the interaction between corruption and infrastructure provision, employing a data set on Italian public contracts for roads and highways in the period 2000-2005, the paper examines whether the environmental characteristics (i.e. in particular the corruption level) in the area where the infrastructure is localised affect the efficient management of the public work contract. For this purpose a two-stage analysis is carried out. In the first stage, a non-parametric approach (Data Envelopment Analysis - DEA) investigates the relative efficiency by each single public work execution; in the second stage, the determinant factors of the scores variability are investigated, paying attention on the effect exerted by corruption. We find evidence that greater corruption is associated with lower efficiency in infrastructure provision.