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Download or read book Essays on the Economics of Public Procurement written by Rodrigo Carril Mac Donald and published by . This book was released on 2020 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation consists of three essays that examine how institutional and market factors affect the efficiency of public procurement systems. In the first chapter, I study the trade-off between rules and discretion in public procurement. Should a central government give broad authority to local agencies in the way they award public contracts? Or should it subject them to a strict set of uniform regulations? I study this question in the context of US federal procurement. I find that, at current levels, the benefits from waste prevention are modest relative to the size of compliance costs introduced by regulation. In the second chapter, co-authored with Mark Duggan (Stanford), we study the relationship between market structure and public procurement outcomes. In particular, we ask whether and to what extent consolidation-driven increases in industry concentration affect the way in which the government procures its goods and services. We focus on the defense industry, by far the largest contributor to federal procurement spending in the U.S. We find that increased market concentration caused the procurement process to become less competitive, induced a shift from the use of fixed-price contracts towards cost-plus contracts, but find no evidence that consolidation led to a significant increase in acquisition costs. In the third chapter, joint with Andres Gonzalez-Lira (UC Berkeley) and Michael S. Walker (US Department of Defense), we study the effects of increasing competition for public contracts through advertising. Publicizing contract opportunities promotes bidder participation, potentially leading to lower acquisition costs. Yet extensive advertising could also exacerbate the adverse selection of bidders on non-contractible quality dimensions. We study this trade-off in the context of procurement contracts for the U.S. Department of Defense. We find that publicized contracts opportunities increases competition and leads to a different pool of vendors, which on average offer lower prices. However, we also find that the post-award performance of publicized contracts worsens, resulting in more post-award cost overruns and delays. The latter effect is driven by goods and services that are relatively more complex, highlighting the role of contract incompleteness.