The Impacts of Different Regulatory Regimes on the Effectiveness of Public Procurement

The combination of two reforms in Russia, reform of public-sector entities and of public procurement, enables us to estimate the results of a transition from rigid to more flexible regulations in public procurement (PP). We consider two public universities in 2011–2012. The procurements of one university were regulated by rigid Federal Law during the entire period; the procurements of the other university were regulated by Federal Law until June 2011 and then by a more flexible regulation. Using the difference-in-differences methodology, we assess how the transition to this new regulation affects the main PP parameters. We show that more flexible regulation leads to a decline in bid competition but improves contract execution.