The Impact of Competition and Purchase Volume on the Price in Public Procurement Tenders (article in Lithuanian)

Zinaida Gineitienė, Karolis Šerpytis

Abstract


Public procurement is a very important part of economy, in Lithuania public procurement constitutes 10% of gross national product, while in European Union it constitutes 16%. One of the key elements in public procurement is the price. This is the variable that can be influenced by a purchasing entity. The purpose of the article is to validate the model defining relationship between the dependent variable, the price and independent variables, the competition and the purchase volume in public procurement tenders. Purchase management scientific literature studies and public procurement research led to the model which is based in the auction theory. Auction theory defines that the price (the winning bid) in auction depends on the object valuations by bidders (bidder’s costs for public contract execution) and competition (the number of bidders). Larger quantities can influence the costs of bidder but it is not motivating to bid lower if the competition is not sufficient. Therefore, relationship between the competition, the purchase volume and the price is complex.

Keywords


public procurement; auction theory; purchase management; competition; procurement centralization

Full Text:

PDF (Lithuanian)

Article Metrics

Metrics Loading ...

Metrics powered by PLOS ALM

Refbacks

  • There are currently no refbacks.




"Societal studies" ISSN online 2029-2244 / ISSN print 2029-2236