Can Electronic Procurement Improve Infrastructure Provision? Evidence from Public Works in India and Indonesia

This paper examines whether electronic procurement (e-procurement), which increases access to information and reduces personal interactions with poten-tially corrupt officials, improves procurement outcomes. We develop unique datasets from India and Indonesia and use variation in adoption of e-procurement within both countries. We find no evidence of reduced prices but do find that e-procurement leads to quality improvements. In India, where we observe quality directly, e-procurement improves road quality, and in Indonesia, e-procurement reduces delays. Regions with e-procurement are more likely to have winners come from outside the region. On net, the results suggest that e-procurement facilitates entry from higher quality contractors. JEL Codes: H57, O12, O53 ∗The authors are from Wisconsin-Madison (Lewis-Faupel), MIT (Olken) and Harvard University (Neggers and Pande). We thank the editor, Dan Silverman, and three anonymous referees for useful comments, Maria Acevedo for superb field work and research assistance, and the International Growth Center for financial support. We thank Abhijit Banerjee for many thought-provokin