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Inefficient R&D in Public Procurement: Negative Consequences of a Separation between Award and Actual Contract

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  • Dieter Bös

Abstract

In public procur ement a temporal separation between award and actual contract allows private entrepreneurs who did not get the award to sue to become contractor. Hence, not only the award-winning entrepreneur, but also the losers will engage in relationship-specific investments. Unfortunately, in such a situation it is impossible to find fixed prices which guarantee the achievement of both efficient trade and efficient investment.

Suggested Citation

  • Dieter Bös, 1999. "Inefficient R&D in Public Procurement: Negative Consequences of a Separation between Award and Actual Contract," CESifo Working Paper Series 208, CESifo.
    • Handle: RePEc:ces:ceswps:_208
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    References listed on IDEAS

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    Keywords

    Procurement; Incomplete Contracts;

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