TY  - JOUR
TI  - Efficiency of Simple Homogeneous Good Procurement under Rigid Governmental Regulation: The Case of Sugar Sand Procurement in Russia
T2  - HSE Economic Journal 
IS  - HSE Economic Journal 
KW  - public procurement
KW  - e-auctions
KW  - procurement efficiency
KW  - sugar sand market
KW  - competition
AB  - In 2000s Russian government considered e-auction as the best way to procure goods for public needs. In this paper we confirm this proposition using empirical dataset on 3 thousands contracts for procurement of sugar sand in Russia in 2011. Our data shows that unit prices are higher in the case of long-term contracts. This result can be explained by rigidity of public procurement regulation - because Russian legislation allows only fixed price contracts. Under these conditions suppliers can be ready to participate in public procurement tenders for long-term contracts only if their price includes some «risk premium» covering additional expenses of supplier in case of unfavorable turn in the market. Our analysis shows that sugar prices in Russian public procurement are lower for contracts with higher volume. These results are in the line with conclusions of previous studies of public procurement in other countries. Influence of competition measured by the number of suppliers participating in procurement procedure has quadratic form. It means that the effect of new participant is lower when number of competitors is higher and vice versa. Also our analysis shows that there are essential distinctions in influence of the same factors on contract prices for competitive procedures and void auctions. This result is important for economic policy but additional consideration is needed here.
AU  - Andrei Yakovlev
AU  - Alexandra Bashina
AU  - Olga Demidova
UR  - https://ej.hse.ru/en/2013-17-4/109043239.html
PY  - 2013
SP  - 649-677
VL  - 17