PROJECT

THE ANDEAN WAY? UNDERSTANDING CORRUPTION AND INEFFICIENCY IN PERU

Researcher: Paul Lagunes

A large portion of the developing world was recently rocked by a corruption scandal that originated in Brazil. The nation’s largest construction group was colluding with government officials in order to inflate the costs of public infrastructure. For instance, in Peru, as reported by The Economist, the Brazilian firm would “win contracts by making low bids and then corruptly secure big increases in costs through addenda—in some cases when the ink on the contract was barely dry.” This maneuver, of course, came at the expense of the usual victim: the taxpaying public. Thus, in view of this troubling issue, the researchers have launched a project that, first, aims to uncover the frequency with which this corrupt maneuver appears across Peru’s districts over time. Once the researchers have measured the extent to which local governments have precociously approved raising the cost of infrastructure projects after contracting they will seek to reveal the political dynamics that make this unfortunate practice more or less likely. Understanding how politics relates to corruption is an important step toward curbing the problem in Peru and beyond.