Auditing Collusion in Public Procurement Quality: An Empirical Study

Hisayuki Yoshimoto

University of Glasgow

with Rieko Ishii (Shiga University)

By using a unique dataset of public procurement auctions and construction audit scores, we investigate detected tacit collusion between auditors (supervisors) and construction firms (agents), in which auditors and firms collude to cut corners in quality audits, resulting in relatively low-quality construction. In this collusion, the auditors (municipal officers) partially neglect to carry out quality checkups. Knowing that is the case, construction firms cut their costs to improve the quality of the construction. Eventually whistle-blowing happens, and a subsequent scrutinization by the principal (municipal authority) halts this tacit collusion, as well as revealing the poor quality of past procurement constructions. After the whistle-blowing, the firms improve the quality of procured projects by 7 to 10.2 percent. However, as an unintended consequence, such quality improvement comes with an increase in procurement auction prices. The municipal’s expenditure on construction increases by 1.4 percent after the end of the auditor-firm collusion, indicating that, when it comes to public construction procurements, the old adage “you get what you pay for” can apply.

2026年04月17日(金) 16:30-17:30

永国寺キャンパス TBA

TBA

Katsunori Yamada

Kindai University

TBA

2026年06月19日(金) 14:40-15:40

永国寺キャンパス A108

Decentralization, civic self-governance and the erosion of local democracy in Japan’s rural peripheries

Hanno Jentzsch

Institute of East Asian Sudies/Japanese Studies, University of Vienna

The legitimacy of local elections in Japan is challenged by decreasing turnout and an increase of uncontested races, especially in rural towns and villages. This long-standing development is typically linked to a combination of aging, a lack of local political autonomy, and a shortage of candidates. Based on in-depth field research in various localities, this paper argues that an often-overlooked aspect of the crisis of local democracy lies in the long-term effects of the mid-2000s municipal merger wave. In these mergers, hundreds of socio-economically struggling rural towns and villages lost not only their administrative autonomy, but also their democratically elected mayors and assemblies. In the absence of sub-municipal electoral districts, peripheralized rural communities must “agree” on one candidate – or risk losing representation in the municipal assembly. Uncontested races may thus not only reflect a shortage of candidates, but also behind-the-scenes attempts to avoid electoral competition to secure territorial representation. In a parallel development, the merger wave also led to the promotion of civic self-governance bodies to discuss and “solve” threats to local livelihoods at the sub-municipal level. Since 2015, the number of such “Regional Management Organizations” has increased rapidly, especially in the rural peripheries of merged municipalities. Most RMO are funded or even (indirectly) created by local governments. I argue that these “state-linked” civic self-governance bodies further challenge the position of elected local representatives, as municipal administrations treat the former as representatives of their respective communities, while the latter depend on unanimous support from their shrinking constituencies and thus have an interest to maintain amicable relations with RMO. The political promotion of ostensibly “apolitical” state-linked civic self-governance organizations thus further undermines representative local democracy in Japan’s rural peripheries.

2026年07月28日(火) 14:40-15:40

永国寺キャンパス TBA