Bureaucratic Competence and Procurement Outcomes

Decarolis, Francesco; Giuffrida, Leonardo M.; Iossa, Elisabetta; Mollisi, Vincenzo; Spagnolo, Giancarlo

doi:10.1093/jleo/ewaa004

Cited by 51 publications

(40 citation statements)

References 54 publications

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“…Cameron (2000) finds that limiting purchaser's discretion reduced prices in the US electricity markets, and Coviello et al (2018) show that greater discretion causes a significant increase in the probability that Italian purchasers will contract the same bidders repeatedly. Decarolis et al (2020) show that an increase in US federal procurement officials' competence decreased expenditure, time delays and number of renegotiations. Bucciol et al (2020) also show the importance of competence and discretion in their study on procurements of medical devices in Italy.…”

Section: Related Literaturementioning

confidence: 98%

Competition and efficiency in repeated procurements: Lessons from the Finnish rehabilitation markets

Pitkänen

2022

Health Economics

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Inefficient practices and lack of competition are common problems in public procurements. In this study, I examine the effects of a procurement practice reform in the Finnish rehabilitation markets where providers are acquired in a repeated manner through competitive bidding scoring auctions. Until recently, the largest public procurer did not use any systematic criteria for accepting providers, and only a few providers did not receive a contract. After the reform, providers were systematically accepted based on their capacity and the local demand. I analyze the effects of the reform on prices in physio, speech and occupational therapy services with data that covers five subsequent procurements. I use the pre‐reform differences in local competition within the markets in a difference‐in‐differences setting. The descriptive evidence shows that the reform slowed down the rapid increase of prices in all three services. The regression analysis indicates that effects are strongest in the most competitive local physiotherapy markets. This suggests that increasing entry and competition in the less competitive services and local markets would benefit the public procurer.

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Section: Related Literaturementioning

confidence: 98%

Competition and efficiency in repeated procurements: Lessons from the Finnish rehabilitation markets

Pitkänen

2022

Health Economics

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“…We do so by exploiting unexpected deaths of managers of federal bureaus active in innovation procurement. As mentioned earlier, using deaths as a source of exogeneity within organizations is a relatively common estimation strategy (Jäger, 2017), which we exploited in an earlier work that studies US federal procurement of standardized services (Decarolis et al, 2021). For this analysis, our strategy requires first isolating the death event of relevant public managers around the time of project selection.…”

Section: Empirical Strategymentioning

confidence: 99%

“…The data covers all federal contracting offices' transactions over $3000. They have been used extensively in previous research, including studies by Liebman and Mahoney ( 2017 ), Warren ( 2014 ), Kang and Miller ( 2017 ), Giuffrida and Rovigatti ( 2018 ), Decarolis et al ( 2021 ).…”

Section: Endnotesmentioning

confidence: 99%

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Buyers' role in innovation procurement: Evidence from US military R&D contracts

Decarolis

Rassenfosse

Giuffrida

et al. 2021

Economics Manag Strategy

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This study provides the first quantification of buyers' role in the outcome of R&D procurement contracts. We combine together four data sources on US federal R&D contracts, follow-on patented inventions, federal public workforce characteristics, and perception of their work environment. By exploiting the observability of deaths of federal employees, we find that managers' death events negatively affect innovation outcomes: a 1% increase in the share of relevant public officer deaths causes a decline of 32.3% of patents per contract, 20.5% patent citations per contract, and 34.3% patent claims per contract.These effects are driven by the deaths occurring in the 6 months before the contract is awarded, thereby indicating the relevance of the design and award stage relative to ex post contract monitoring. Lower levels of self-reported within-office cooperation also negatively impact R&D outcomes.

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“…First, we calculate the percentage of procurement contracts with cost overruns. Public procurement data is often used in the literature to study performance (Spenkuch, Teso, and Xu 2021;Decarolis et al 2021). We follow this literature and compute the yearly percentage of all public contracts awarded by the municipality where payments are greater than the adjudicated costs.…”

Section: Government Performancementioning

confidence: 99%