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The One and Only: Single-Bidding in Public Procurement

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  • Vitezslav Titl

Abstract

Approximately 42% of European public procurement contracts are awarded to a sole bidder. As this market represents about one-seventh of GDP in developed countries, any inefficiency is a first-order concern. This paper examines a Czech reform that prohibited awarding such single-bid contracts. Using a difference-in-differences approach, I find the reform reduced prices by 6.1% relative to estimated costs, with no evidence of quality reduction. Furthermore, I provide suggestive evidence that procuring authorities try to actively get more bidders and that the prices of procurement contracts supplied by politically connected and anonymously owned firms were not reduced after the reform.

Suggested Citation

  • Vitezslav Titl, 2025. "The One and Only: Single-Bidding in Public Procurement," CESifo Working Paper Series 11697, CESifo.
    • Handle: RePEc:ces:ceswps:_11697
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    References listed on IDEAS

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    1. Francesco Decarolis & Raymond Fisman & Paolo Pinotti & Silvia Vannutelli, 2019. "Rules, Discretion, and Corruption in Procurement: Evidence from Italian Government Contracting," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-344, Boston University - Department of Economics.
    2. Francesco Decarolis, 2014. "Awarding Price, Contract Performance, and Bids Screening: Evidence from Procurement Auctions," American Economic Journal: Applied Economics, American Economic Association, vol. 6(1), pages 108-132, January.
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    5. Eitan Goldman & Jörg Rocholl & Jongil So, 2013. "Politically Connected Boards of Directors and The Allocation of Procurement Contracts," Review of Finance, European Finance Association, vol. 17(5), pages 1617-1648.
    6. Decio Coviello & Luigi Moretti & Giancarlo Spagnolo & Paola Valbonesi, 2018. "Court Efficiency and Procurement Performance," Scandinavian Journal of Economics, Wiley Blackwell, vol. 120(3), pages 826-858, July.
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    8. Titl, Vitezslav & Geys, Benny, 2019. "Political donations and the allocation of public procurement contracts," European Economic Review, Elsevier, vol. 111(C), pages 443-458.
    9. Jeffrey B. Liebman & Neale Mahoney, 2017. "Do Expiring Budgets Lead to Wasteful Year-End Spending? Evidence from Federal Procurement," American Economic Review, American Economic Association, vol. 107(11), pages 3510-3549, November.
    10. Ján Palguta & Filip Pertold, 2017. "Manipulation of Procurement Contracts: Evidence from the Introduction of Discretionary Thresholds," American Economic Journal: Economic Policy, American Economic Association, vol. 9(2), pages 293-315, May.
    11. David Schoenherr, 2019. "Political Connections and Allocative Distortions," Journal of Finance, American Finance Association, vol. 74(2), pages 543-586, April.
    12. Emanuele Colonnelli & Francesco Loiacono & Edwin Muhumuza & Edoardo Teso, 2024. "Do Information Frictions and Corruption Perceptions Kill Competition? A Field Experiment On Public Procurement in Uganda," NBER Working Papers 32170, National Bureau of Economic Research, Inc.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    single-bidding; public procurement; political connections; corruption;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H57 - Public Economics - - National Government Expenditures and Related Policies - - - Procurement

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