Public Procurement Market Research Articles

Conservatism, mobility, isolation: Approach to the study of agents’ behavior in the public procurement market

The purpose of the article is to substantiate the application of the authors’ approach and methodology based on a combination of machine learning technologies and the construction of directed graphs with their subsequent clustering for a systematic study of the quantitative and qualitative characteristics of the public procurement market and the behavior of agents in this market. As a result of the study, regional and sectoral factors influencing the relationship between agents of the public procurement market were identified. Such factors were not previously identified, and were determined only thanks to the combination of machine learning technologies and the theory of networks and graphs proposed by the authors. Another result of the study-the models of relationships in public procurement market are systematized in the authors’ interpretation, integrating the macroeconomic situation in the market and the marketing strategies of market players. Such stable patterns of behavior of agents of the public procurement market as "isolation", "conservatism" and "mobility" were identified, and it was substantiated that the isolated or conservative behavior of market players increases the likelihood of corrupt conspiracies. All of the above was not systematically studied before. So, it has scientific novelty and high practical significance. The research contributed to the increment of scientific knowledge in application of the theory of networks and graphs, in problems of state regulation of the economy, counteraction to the monopolization of markets and encouraging competition. The practical results of the work are related to the generation of recommendations to the Russian authorities, regulators of the public procurement market and bidders on the choice of effective market behavior strategies.

Політика публічних закупівель у реалізації стратегії цифрової трансформації: пріоритети ЄС та України

The aim of the article is to study the policy of public procurement and the scientific substantiation of its priorities in the context of the implementation of the digital transformation strategy in the EU and in Ukraine. The research methodology is based on the content analysis of the digitalization policy of public procurement used in the practice of both the EU and Ukraine, as well as in its scientific generalization to substantiate the priorities for the implementation of the digital transformation strategy. The authors examined the model of interaction of subjects of the public procurement market in the EU with the use of digital tools. It is found that the harmonized EU rules in the field of application of common digital public procurement instruments are designed to ensure fairness, transparency and non-discrimination in determining participants in public contracts, to which not only EU companies are admitted, but also the representatives of WTO Member States that have signed the Agreement on Government Procurement. The article discloses the stages of introduction of digital public procurement tools in the EU and in Ukraine. It is determined that in the EU, the process of digitalization of public procurement began in the second half of the 2000s with the introduction of an electronic diary of tenders, significantly intensifying in the second half of the 2010s with the adoption of a package of the EU directives in the field of public procurement and the phased introduction of digital tools (invoices, forms, applications for tenders, the European single procurement document, etc.). The current stage of transformation of digital public procurement tools in the EU was marked by the introduction of a single space for these public procurement in the EU from 2023. The priority directions of digital convergence of the public procurement systems of the EU and Ukraine are substantiated, including the development of cooperation tools for joint public procurement, promotion of competition, countering the corruption, as well as strengthening the professionalization of the public procurement systems.

The Influence of The State Purchaser on Competition in Public Procurement in Russia

From the economic point of view, the competitive aspect of public procurement is a relatively poorly studied area of public procurement policy research, as economists tend to focus more on the problems of risk sharing, incentives formation, overcoming information asymmetry specific to public procurement. On the other hand, the study of public procurement from the perspective of supplier firms also receives limited attention, probably due to the fact that, from the economic point of view, their analysis belongs to the peripheral area of microeconomics, focusing on the analysis of monopsony and purchasing power of the state. This article attempts to characterize public procurement in terms of the specifics of the market structure of this quasi-market. As a premise of the analysis, it should be emphasized that a competitive analysis of the regulation of the state as buyer and its influence on the market cannot be properly conducted in situations where it is the only buyer (i.e., in purely "public markets") or where it has no significant market power (i.e., in purely private markets). And if the first situation is analyzed through the prism of sectoral regulation (because of the pure monopsony of the public buyer), in the second case the influence of public procurement is almost insignificant (because of the lack of purchasing power in the population) and is likely to remain below all thresholds of significance. The features of the public procurement market, where the state buyer dominates, having large-scale purchasing power and interacting with private markets are revealed; the consequences of his behavior are determined.

European experience with the operation and control of the procurement mechanism for goods, works, and services using budget funds

The subject of the study is the practical experience of the functioning of the mechanism of public procurement of goods, works and services in the member states of the European Union, its reformation under the influence of the introduction of new EU legislative norms in the field of public procurement, and the harmonization of the national legislation of the participating countries with Directives 2014/23/EU, 2014/24/EU and 2014/25/EU. The purpose of the work is to establish the impact of the new legislative norms of the European Union in the field of public procurement on the mechanism of procurement of goods, works and services for budget funds in the European Union, to identify the advantages of applying these norms. The methodological basis of the article is a set of cognitive methods applied to the mechanism of public procurement. The research was based on general scientific methods, namely: dialectical, which implies objectivity, comprehensiveness and systematic knowledge; logical; special methods of scientific knowledge: historical, method of systematic analysis and generalization of normative documents. The general logic of the article is based on a complex and systematic approach using modern scientific apparatus. Results of the article. The article establishes the main directions of changes in the mechanism and tools of public procurement in the countries of the European Union, which took place after the implementation of the norms of Directives 2014/23/EU, 2014/24/EU and 2014/25/EU, an analysis of the advantages of their implementation in national legislation of member states. The evaluation of the efficiency of the public procurement market in the EU countries was carried out. The directions and sources of further research are substantiated, first of all, by taking into account the aspects of digitalization of the sphere of public administration and finance, social and environmental innovations. Field of application of results. The results can be used by state and local self-government bodies, territorial communities, and economic entities of various forms of ownership. Conclusions. The new norms of EU legislation in the field of public procurement, set out in Directives 2014/23/EU, 2014/24/EU and 2014/25/EU, are aimed at simplifying procedures for public procurement of goods, works and services for budget funds, which promotes the free movement of goods and services in the countries of the European Union. As a result, customers get better value for money. Thus, public procurement becomes a tool of EU strategic policy. Although it cannot be claimed that the EU's public procurement policy is flawless, the experience of all participating countries is always taken into account in the process of its development and implementation. The EU public sector can use the procurement of goods, works and services with budget funds to increase the number of jobs, growth and investment, as well as to create an economy that is more innovative, resource and energy efficient and socially inclusive.

DEVELOPMENT OF DOMESTIC PUBLIC PROCUREMENT IN THE SHADOW OF CRISIS SITUATIONS OF PAST YEARS

In the economic sense, the COVID-19 crisis has resulted in a fast-moving, rebounding crisis. In the course of our research, we looked for the answer to what results the pandemic crisis brought about from a public procurement point of view, and what peculiarities can be identified as a result of the current Russian-Ukrainian conflict and the energy crisis. Our basic hypothesis is that the pandemic crisis situation had a less negative impact on the Hungarian public procurement market, however, the Russian-Ukrainian conflict and the energy crisis result in a much more complex economic situation, so their impact is likely to be more prolonged.

Конкурентные стратегии участников торгов по госзакупкам

The active promotion by the Government of the Russian Federation of measures to support small and medium-sized businesses through the system of state and municipal procurement from 2022 (the obligation to purchase at least 25% of their needs and small and medium-sized businesses instead of 15% from 2014 to 2021 [1]) has led to actualization of questions about barriers to entry into the state order markets. The purpose of the study is to create a “competition map” on the basis of which an entrepreneur entering the public procurement market will be able to determine in which industry and regional markets it is more efficient to work, taking into account the current level of competition. To achieve the stated goal, the following tasks were implemented: the results of the procurement activities of all Russian regions for 2020 and 2021 were analyzed in the format of a competition matrix: the participation of suppliers from each Russian region in procurements announced in each of the regions was evaluated, the probability of winning was determined depending on the combination participant-region”, as well as “region-object of procurement”. During the study, statistical tools were used to work with average data on competition and key factors and measurements that have a correlation. The sources of information were 3,976,711 notices and their corresponding public procurement protocols from the open data of the EIS ftp server for 2020 and 2021, collected and processed by a program written in Python using the PostgreSQL 12 database. Based on the results of the research, recommendations were given to procurement participants on which regional and industry markets it is more efficient to participate in procurement, and where the maximum probability of winning is guaranteed.

Problems and prospects of the functioning of the public procurement market within the EAEU

Currently, the issues of assessing the effectiveness of work to ensure access to the markets of state (municipal) procurement of the countries of the Eurasian Economic Union (EAEU) and the existing obstacles in this market are acquiring particular relevance. In this connection, the article analyzes the current state and prospects for the formation of this market, identifies and discloses the main obstacles to its functioning, such as non-provision of the national regime, the introduction of repeated exemptions from the national regime, non-recognition of electronic digital signatures and others, as well as recommendations for improving his work.

Lithuania ∙ Competition Law Enforcement in Public Procurement Markets: Joint Bidding

Lithuania ∙ Competition Law Enforcement in Public Procurement Markets: Joint Bidding

New-generation trade agreement with Japan: Significance to EU Companies

Objective: The New-generation trade agreements, which include the agreement with Japan, provide wide coverage – not only the liberalisation of trade in goods or services but also the protection of intellectual property rights, the public procurement market, sustainable development and others. This paper aims to demonstrate key provisions and (both ex post and ex ante) opportunities that the agreement creates for EU companies. Research Design & Methods: The research methods include a critical review of existing literature, an analysis of relevant legal and official documents of the European Union, as well as the provisions of the EU-Japan trade agreement. The empirical research focused on Eurostat data. Findings: The provisions of the EU-Japan agreement provide an incentive for European companies to strengthen their position on the Japanese market. The elimination of import duties and other barriers to trade in Japan in relation to certain agricultural products on the entry into force of the agreement contributed to higher exports from the EU for these groups of goods. What might be expected is the additional effect of the liberalisation of bilateral trade on third countries. In fact, standards or rules agreed by Japan and the EU may become even more attractive to third countries, as their adoption would facilitate access to two large markets. Implications & Recommendations: Japan is a relatively important trading partner for the EU and vice versa. One of the biggest achievements of the agreement made between the European Union and Japan includes the wide and deep liberalisation of trade in goods. Despite the fact that the overall level of tariff protection is relatively low, there are still some groups of goods for which the protection in the form of customs duties constitutes an important barrier, as a result of which the conditions for competing on the partner’s market deteriorate. It seems that EU entrepreneurs should make more use of the opportunities which are created by the provisions of the free trade agreement with Japan. So far, the trade crisis caused by the pandemic has stood in the way. Contribution & Value Added: Research conducted so far is of an ex ante nature, both regarding the provisions of the agreement (publications written before 2018) and the evaluation of its potential effects on economy, trade, production or selected sectors. The research carried out in this article is of an ex post nature; it covers the period following the entry into force of the agreement and does not present any growth scenarios or forecasts, as was the case in the existing research. The article attempted to juxtapose the provisions of the agreement with Japan with trade conditions applicable to EU companies, as well as with the growth rate, volume and coverage of bilateral trade in goods.

Mind the (Regulatory) Gap:

Growing concern that domestic undertakings are priced out of the European public procurement market has yielded EU rule makers to push forward with legislative action to level the playing field as regards foreign subsidies. Hence, the Commission has recently presented a legislative proposal on ‘foreign subsidies distorting the internal market’. Given the potential impact of the proposed tools on public procurement procedures, the main aim of this article is to offer a critical assessment of the present proposal. Overall, we contend that it is difficult to argue why the proposal under its current form should hold sway in public procurement. Keywords: foreign subsidies; level playing field; legislative proposal

Slovenia ∙ Legislative Developments of the Slovenian Public Procurement Market in 2021 and January 2022

Slovenia ∙ Legislative Developments of the Slovenian Public Procurement Market in 2021 and January 2022

SOCIAL CLAUSES AS AN INSTRUMENT SUPPORTING THE SOCIAL ECONOMY SECTOR

Based on the research results, the article presents opinions of the representatives of social economy sector and local authorities on the current use of social clauses indicated in public procurement regulations, which are a tool oriented at increase of participation of the social economy sector in the public procurement market. The research confirms low usage of social clauses mechanism. The main constraints in use of these tools by local authorities include: lack of sufficient knowledge about social benefits arising from providing social services by social economy units and fear of using a legal measure that limits competition of entities operating on the free market. The respondents underline that information about the goals of social economy and the its potential are the basis for activities aimed at increasing interest in using the social clause mechanism.

Falsified and Substandard Medicines in Developing Countries: Seeking for The Sampling Procedure to Find them

Falsified and substandard medicines is a very important issue, especially in developing countries including Indonesia. World Health Organization (WHO) stated that 1 in 10 medicines in developing countries are substandard or falsified. It is result in risks for patients and health systems relating to ineffective drugs, prolong treatment times, possible side effects, increased healthcare spending, even the risk of serious illness and death. There are many factors responsible for this situation, namely the effectiveness of government control, public drug procurement policies, market and economic competition, the depletion of entry barriers driven by free and online trade, availability of raw materials, and mastery of technology on pharmaceuticals. The problem is how to find falsified and substandard medicines amidst so many kinds of medicines in market. If the sampling is done randomly on all types of medicines in all market, it will be less likely to find them. In addition, this kind of sampling technique will be expensive because it requires a lot of resources. Therefore, a risk-based systematic mechanism is needed to guide sampling procedure. This research was aimed to design a model that could be used as a reference. Using the system thinking method, we mapped out relationships between various factors and phenomena surrounding the issue. Then, the system dynamics modelling was developed with a focus on sentinel groups that were most at risk of drug counterfeiting cases. All relevant variables were discussed, and some recommendations were provided in this paper. We hope, using this recommendation, the sampling procedure becomes faster, more efficient, and more likely to find cases. It is because the more effective the way to control falsified and substandard medicines, the higher the protection that consumers or patients may get.

R&D Procurement by Certain Types of Legal Entities Listed in the Federal Law of July 18, 2011 No. 223-FZ

The article provides a brief overview of the general state and structure of the Russian public (regulated) procurement market and the analysis of the public procurement market of R&D by certain types of legal entities listed in the Federal Law of July 18, 2011 No. 223-FZ. Based on the analysis of statistical information on the amount of R&D procurement, their efficiency and structure, it has been concluded that competition in this segment of the regulated procurement market is extremely low: the most part of R&D contracts are concluded through procurement from a single supplier, the efficiency of competitive procedures is extremely low: there are more than a half failed procurements depending on the methods of carrying out in the total volume of purchases. The article presents the most feasible in the author's opinion the reasons for the existing structure of public R&D procurement market.

The Transition of the Visegrad Countries Toward Sustainable Public Procurement

ABSTRACT This paper aims to examine the impact of the inclusion of sustainability aspects in the evaluation criteria in public tenders on the performance of small and medium-sized enterprises in the public procurement market of the Visegrad Countries. Using data on more than 30,000 contract award notices from Tenders Electronic Daily, we found a positive effect of sustainability aspects in the evaluation criteria on SMEs bidding. However, even though SMEs won more than three-quarters of all contracts in the dataset, they obtained just over half of the total financial value of all contracts.

PRODUCTION GREENING AND EXPAND OF EXPORT OPPORTUNITIES OF UKRAINE UNDER EU ASSOCIATION

Topicality. The urgency of the problem of greening and development of export opportunities of Ukrainian producers today is growing due to the need to adapt to changes in the European Green Deal, as well as the need for environmental modernization, which creates new opportunities for export and prevents the negative impact of non-tariff environmental restrictions. Ensuring environmental modernization of production are key and relevant factors for sustainable development and competitiveness of enterprises, the basis for successful international cooperation. Aim and tasks. The purpose of the article is to develop theoretical and practical proposals that should justify the principles of greening the economy and the mechanism of their practical implementation at the enterprise level in terms of association with the EU. The proposed measures of ecological modernization of enterprises can be implemented at almost any export-oriented enterprise. Research results. In terms of environmental efficiency, Ukraine ranks 60th in the world. The structure of capital investments in environmental protection by types of environmental measures and types of economic activity where ecological modernization is taking place in Ukraine is determined. The changes due to the introduction of the European Green Course, as well as the consequences for Ukrainian exporters are outlined. A number of measures have been proposed at the enterprise level that will eliminate the risk of restricting access of Ukrainian goods to the EU market due to new "climate" non-tariff barriers to trade, including: reducing the use of non-renewable energy sources, transition to more energy and resource-efficient technologies. technologies that create a smaller carbon footprint, increase attention to the environmental characteristics of goods and services, active participation in the standardization process in accordance with international standards, introduce into production practices technical regulations harmonized with EU standards, entering the EU public procurement market with "green" goods Conclusion. The basis for the development of exports by Ukrainian enterprises is further integration into the EU market, which leads to increasing dependence of Ukrainian producers on the greening of the economy of the common European market. In anticipation of the introduction of new non-tariff environmental barriers to SWAM in the framework of the association with the EU in 2023, Ukrainian exporters must already adapt to these requirements. Prospects for future research in the field of greening of export industries are related to the mechanisms of transition to environmentally friendly industries and finding adequate to the economic situation sources of funding for environmental modernization of Ukraine's economy.

Ways to improve the efficiency of the public procurement market of the Republic of Kazakhstan

Purpose of research. Development of theoretical and methodological provisions and economically sound proposals to improve the efficiency of the public procurement system of the Republic of Kazakhstan.Methodology. In the course of the study, various methods of general scientific knowledge, comparative analysis, economic and statistical analysis were used.Originality / value of research. The results of the study can be used in the development of regional target programs for socio-economic development, amendments and additions to the legislative and regulatory acts regulating the processes of state procurement.Research results. Through the application of appropriate research methods, the conceptual foundations of the public procurement market are disclosed, the evolution of the public procurement system of the Republic of Kazakhstan is tracked, a comparative analysis of Kazakhstani and foreign experience in building this system is carried out, the main problems of the public procurement market functioning are identified and theoretical and methodological provisions and economically sound proposals are developed. to improve its efficiency.

Examining the Relationship between the Economic Performance of Technology-Based Small Suppliers and Socially Sustainable Procurement

Sustainable public procurement plays an important role in addressing not only environmental but also economic and social issues through government acquisitions from technology-based small suppliers. In this context, the objective of this study is to better understand the holistic public procurement process by assessing the operational efficiency of technology-based small suppliers and associating the economic aspect of public procurement with the social aspect, such as women-owned businesses. To this end, we analyzed U.S. Department of Defense Small Business Innovation Research grantees by combining network data envelopment analysis with bootstrap truncated regression analysis. Drawing on the analysis results, we found that (1) there is heterogeneity in the performance of research and development, network building, and commercialization sub-processes, and (2) there is a positive relationship between the overall performance and women-owned small suppliers who excel particularly in network building. The former implies that small suppliers may have different expertise in the chain of public procurement; the latter suggests that woman entrepreneurs with a business network may be able to outperform their counterparts in the public procurement market.

Exploring Measures for Improving Small and Medium Construction Enterprises’ (SMCEs) Participation in the Nigerian Public Procurement

Despite the roles which small and medium construction enterprises (SMCEs) play in the Nigeria construction industry and the economy at large, extant research revealed that their participation in public procurement is poor as large firms have dominated the public procurement market. Previous studies have identified barriers responsible for their low participation and also suggested improvement measures. However, improvement measures best suited to dismantle/mitigate each barrier is not known. This study thus, assessed measures for improving SMCEs’ participation in Nigeria public procurement. The study collected data from 100 SMCEs in Nigeria, via a questionnaire survey. Mean/relative importance index was used for ranking the measures and ANOVA for checking difference between the studied measures. The result of the study revealed that E-procurement is the best measure for improving SMCEs’ participation in public procurement as it is best in dismantling barriers related to “problematic procurement procedure”, “lack of awareness of public procurement” and “legal issues/corruption”. Training which is suitable for eliminating barriers related to “lack of skilled employees and partners”, emerged as the second best followed by Division of Contract into lots that is best suitable for tackling barriers related to “lack of resources” which is contrary to previous researchers’ belief that it is the best measure. The study concludes that E-procurement, training and division of contract into lots are all suitable measures for improving SMCEs’ participation in Nigeria public procurement in their other of priority. The study’s findings show that it is desirous that the measures are applied together as none of these measures is singularly sufficient in dismantling all barriers to SMCEs’ participation in public procurement.

Evaluating the effectiveness of ChileCompra's Entrepreneurship Centers policy

AbstractMicroenterprise support programs (MESPs) have gained popularity as a modern development policy since the 1980s, with an increasing number of countries adopting this strategy to enhance economic growth. However, few studies have examined the effectiveness of these programs. This paper evaluates one of these programs, Centros de Emprendimiento ChileCompra in Chile. This initiative has a dual mandate – to serve as a primary vehicle for national procurement and to serve as a microenterprise support program. The microenterprise support component consists of regional centers that provide entrepreneurs with training in business plan development, financing, and taxation to enable greater participation among microenterprises in the public procurement market. Using 8 years of panel data on program contracts from 2007 to 2014, we assess the impact of ChileCompra's microenterprise participation component with regards to the share of the total business and the share of revenues. Our results indicate that the program resulted in an increased share of contracts going to microenterprises at the national level, but that results were uneven at the local level. In many cases, contrary to the policy's goals, the share of microenterprises receiving contracts through ChileCompra declined substantially.