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Abstract
How much does corruption cost in public infrastructure, and who bears it? We study two judicial records of Peruvian road corruption, Odebrecht bribery in road concessions and a sanctioned cartel that rigged national road tenders between 2002 and 2016, and reconstruct from them the universe of tenders and firm roles. Because the competition authority adjudicated each tender, we validate collusion-detection screens against ground truth, and a level screen on the winning bid recovers the verdict where the dispersion screen the literature relies on does not, with areas under the curve of 0.87 against 0.50. Bribed concession projects overran initial budgets by more than half against under a fifth for the rest, and colluded winners bid near the reference-value ceiling while competitive winners gave the State a ten-percent discount. We find no measurable local welfare dividend and no crowd-out of other public investment. The price is a national-budget cost, and level-based screens sharpen its detection.
Keywords
Corruption, Procurement, Collusion, Bid-Rigging, Cost Overruns, Collusion-Detection Screens, Peru, Infrastructure
Citation
Chávez Padilla, Carlos César. 2026. “The Price of Corruption: Evidence from Lava Jato and the Construction Club in Peru.” Working paper.