Negotiated Procedures Overrated ? Evidence from France Questions the Commission’s Approach in the Latest Procurement Reforms

Abstract :

The new European legislative proposals on public procurement suggest introducing the unconditional possibility for public buyers to use negotiated procedures with publication. Such procedures have been available to French public buyers for contracts up to €5 million since 2004. We use an original and comprehensive database from Paris Habitat-OPH, the largest social housing constructor in Europe, to empirically assess the impact of negotiated procedures on price. After satisfyingly dealing with the endogeneity issue associated with the use of negotiated procedures, we find that such procedures significantly decreased the received bids by close to 26 % (the coefficient drops to 15.7% when excluding « abnormally » high offers). Some drivers of the positive effects we observe are highlighted, enabling us to derive practical implications of these results for public policies.

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Organizing Prisons through Public-Private Partnerships: a Cross-Country Investigation

Brazilian Administration Review, January-March, Volume 10, Number 1, p.100-120, (2013)

Abstract: In this paper, we analyze the private participation in prison services in three countries: Brazil, France, and the United States. We highlight striking differences in efficiency between these countries and argue that the explanation for these differences is not restricted to the way property rights are distributed (i.e. public vs. private management). Instead, our analysis suggests that understanding those differences also requires an analysis of the incentives provided by contractual choices as well as decision and revenue rights distribution and institutional constraints. The theoretical literature usually analyzes these blocks separately, and often focuses on property rights distribution. We argue that an efficient arrangement is the result of the way these elements are combined, giving rise to a distinctive governance structure.

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Simon PORCHER

Organizational Choices, Efficiency and Equity in Local Public Services :the Case of French Water Supply Décembre 2012

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Innovation and regulatory outcomes: Evidence from the public-private contracts for water supply in France

Numéro: 2012-11 Innovation and regulatory outcomes: Evidence from the public-private contracts for water supply in France Freddy Huet (Université de la Réunion) and Simon Porcher (IAE Paris) Abstract: One of the most important pitfalls associated with public-private partnership schemes (PPPs) conducted in natural monopoly industries is the difficulty of replacing the winning firm after a contract…

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Retendering a contract for breach of procurement rules or changes to contract

The Applied Law and Economics of Public Procurement

Edited by Gustavo Piga, Steen Treumer

Published 6th September 2012 by Routledge – 308 pages

This book explores Public Procurement novelties and challenges in an interdisciplinary way. The process whereby the public sector awards contracts to companies for the supply of works, goods or services is a powerful instrument to ensure the achievement of new public goals as well as an efficient use of public funds. This book brings together the papers that have been presented during the « First Symposium on Public Procurement », a conference held in Rome last summer and to be repeated again yearly.

As Public Procurement touches on many fields (law, economics, political science, engineering) the editors have used an interdisciplinary approach to discuss four main topics of interest which represent the four different parts in which this book is divided:

  • Competitive dialogue and contractual design fostering innovation and need analysis,
  • Separation of selection and award criteria, including exclusion of reputation indicators like references to experience, performance and CV’s from award criteria,
  • Retendering a contract for breach of procurement rules or changes to contract (contract execution),
  • Set-asides for small and medium firms, as in the USA system with the Small Business Act that reserves shares of tenders to SMEs only.

    More information here

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Une estimation des coûts d’efficience des tarifs actuels des services publics de l’eau en France

Numéro: 2012-10 Une estimation des coûts d’efficience des tarifs actuels des services publics de l’eau en France Simon Porcher (IAE Paris) Abstract: Un résultat communément accepté dans la littérature sur la régulation des services publics (Coase [1946]) est que l’efficience du marché exige un recours à des tarifs binômes avec d’une part un prix marginal égal au…

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Discretion and Efficiency in Public Procurement: Evidence from France

Numéro: 2012-9 Lisa Chever et John Moore (Chaire EPPP) Abstract : The new European legislative proposals on public procurement suggest widening the possibility for public buyers to use negotiated procedures with publication. Such procedures have been available in France for work contracts up to 5 million euros since 2004. Yet, their impact on public procurement efficiency is still to be assessed. We…

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Efficiency and Equity in Two-Part Tariffs: The Case of Residential Water Rates

Numéro: 2012-8 Efficiency and Equity in Two-Part Tariffs: The Case of Residential Water Rates Simon Porcher (IAE Paris) Abstract: As first noticed by Coase (1946), a standard result in utility regulation is that efficiency requires two-part tariffs with marginal prices set to marginal costs and fixed fees equal to each customer’s share of fixed costs. Residential…

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Do Markets Reduce Prices?

Numéro: 2012-7 Do Markets Reduce Prices? Simon Porcher (IAE Paris) Abstract: This paper looks at the reasons for and the results of the make-or-buy decisions in local public services, with specific regards to its possible effects on price and other performance determinants. It uses a rich city-level dataset of water utilities in France for several years. We…

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