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Corruption in Russia is pervasive. We use objective data for a near-population of Russian firms to document that, as a rule, the allocation of public procurement contracts depends on bribes paid by firms to politicians. Bribes follow a political cycle: Politicians prefer to collect bribes around elections as black cash is used to finance election campaigns. An average firm that receives public procurement contracts pays about 30,000 U.S. dollars in bribes during a regional election campaign and gets procurement contracts that bring the firm 100,000 U.S. dollars in additional revenue per year.

Corruption in Procurement and Shadow Campaign Financing: Evidence from Russia. 2011.

Maxim Mironov, (IE Business School, Madrid)
Ekaterina Zhuravskaya, (Paris School of Economics)