Law and Economics Approaches to Bid Rigging
New Horizons in Competition Law and Economics series
A comparison of international procurement data shows that China’s public procurement is limited in terms of GDP. While the real influence of the public sector may be understated by a mere comparison of figures, it is noticeable that Chinese government procurement only accounted for around 1.6 per cent of GDP in 2008. Differences are noticeable not only in terms of the relative size, but also in terms of the absolute size of the procurement market. While exact data on the occurrence of bid rigging conspiracies is not available and academic research is virtually absent with regard to the Chinese situation, a number of observations can still be presented. According to the United States Trade Representative, public procurement prices in the Japanese construction market are inflated by up to 30 per cent as a result of bid rigging conspiracies. Without any sound economic analysis this finding is, of course, not directly applicable to the Chinese public procurement market for construction projects.
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