Publication details

Efficiency versus economy in public procurement

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NEMEC Juraj ŠUMPÍKOVÁ Markéta KLAZAR Stanislav GREGA Matúš

Year of publication 2014
Type Article in Proceedings
Conference Conference Proceedings: The 8th International Days of Statistics and Economics
MU Faculty or unit

Faculty of Economics and Administration

Field Management and administrative
Keywords public procurement; lowest price; best bid
Description We argue that both active and passive corruption represent important problem in the Czech public procurement. We also propose that most of passive corruption is caused by “over-legislation” and the corresponding principle of bureaucratic safety. By documenting the problem of the too-frequent use of economy (lowest price) as the criterion for selecting the best bid by public procurers in CEE countries,we try to describe one concrete dimension of passive corruption. Usage of the lowest price criterion in public procurement has some advantages, but can deliver also problems if it is not used properly, as our two case studies proved.If the focus of procurement is on the process, on compliance with the rules rather than on the actual results, it is difficult to expect positive selections, especially for service and works. The only solution to this problem is radical change–to switch from a focus on the process to a focus on both the process and the results in public procurement by all the main actors, specifically the controlling and auditing bodies.
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