## **Potential for empirical verification**

The listed hypotheses refer to practices that will most often be hidden and illegal, and support or rejection requires information that the agents involved have every incentive to hide. Robust verification or rejection will be difficult, but even limited progress towards better evidence for or against such hypotheses will provide a stronger basis for analysis of policy choices.

The methodological challenges are significant, however. A first challenge is the quality of data that can be collected. Evidence from analysis of existing surveys suggests that even where large enterprise samples are available, the signal to noise ratio in answers regarding the level of corruption in a particular sector can be very low (Kenny, 2006). Corruption is a secret activity, and few respondents may have direct experience and accurate information regarding the nature and extent of bribery.

Such issues will be even more acute in a survey of infrastructure providers. There are a limited number of firms involved in private provision of infrastructure worldwide, and the number involved in contract bidding or operation in any one country is very small. As noted, this challenge has led previous enterprise surveys focusing on corruption to exclude infrastructure providers altogether. Stricter anonymity and confidentiality procedures which limit ability to share underlying data from a survey report will be necessary, but statistical confidence in country-level answers will (surely) remain very low regardless. Ensuring a wide geographic, sectoral and firm coverage will be key to increasing the robustness of any results.

It is worth noting that the data quality issue will extend to control variables in areas such as the level of competition, performance and sector regulatory structures which can be very weak. Including some questions regarding such performance and characteristics within the survey instrument may help to improve this situation, but, if the instrument is to remain a reasonable length, such questions will be necessarily limited.

A further challenge is the presence of numerous bi-causal and interlinked relationships between different types of corrupt and legal transaction a well as institutional forms. This complex causal environment, not significantly analyzed to date and likely to vary significantly by country and sector, will be difficult to unpack.

Despite these obstacles, a survey with wide geographic, sectoral and firm coverage, including a number of questions which overlap to measure the extent of consistency across answers, may play some role in increasing our (currently limited) knowledge about the nature and extent of corruption in the private provision of utility services.

# **5 Conclusion**

The nature of private provision of infrastructure suggests that governance will be key to outcomes. This is confirmed by available evidence –poorly governed sectors perform poorly in terms of pricing, quality and access. There is considerable anecdotal evidence linking poor governance to greater corruption, and suggesting that private provision of infrastructure is a particular target of grand corruption.

At the same time, and despite a range of hypotheses that could be tested using such evidence, we have almost no survey evidence to analyze the nature or extent of grand corruption in the private provision of infrastructure. Available perceptions evidence and broader non-sectorspecific survey evidence both appear ill-designed as a proxy measure. But lack of survey evidence to date reflects the particular nature of private provision of infrastructure and suggests 17