What the study found
The study found that firms with more extensive and higher-quality financial reporting were more likely to win government contracts in competitive Japanese tenders. It also found that political connections weakened this disclosure–procurement relationship.
Why the authors say this matters
The authors conclude that formal transparency matters for public procurement, especially under institutional constraints. They suggest that improving financial reporting transparency can support fairness and efficiency by reducing agency costs, and that political influence creates risks that may call for regulatory reform.
What the researchers tested
The researchers analyzed Japanese procurement data from 2020 and 2021, using 4,955 firm-years of listed companies that won 6,870 central government tenders from JETRO. They used probit, ordinary least squares, and tobit regressions, separated competitive from non-competitive tenders, examined sub-samples by political connection, and checked robustness with instrumental variables and propensity score matching.
What worked and what didn't
Greater reporting quantity and higher-quality reporting were associated with a higher likelihood of winning contracts in competitive tenders. No such association was found in non-competitive tenders. Political connections weakened the disclosure effect, which the study describes as a substitution effect.
What to keep in mind
The abstract does not describe detailed limitations beyond the study scope and methods. The evidence comes from Japanese central government tenders in 2020 and 2021, so the findings are limited to that setting.
Key points
- Firms with more and better financial reporting were more likely to win competitive Japanese government tenders.
- The disclosure effect was not found in non-competitive tenders.
- Political connections weakened the link between disclosure and procurement success.
- The study used 4,955 firm-years and 6,870 central government tenders from Japan.
- Robustness checks included instrumental variables and propensity score matching.
Disclosure
- Research title:
- Disclosure quality predicts wins in competitive Japanese tenders
- Authors:
- Yoshinori Shimada
- Institutions:
- Saitama University
- Publication date:
- 2026-01-07
- OpenAlex record:
- View
- Image credit:
- Photo by Hakim Menikh on Unsplash · Unsplash License
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