Procurement policy and SME participation in public purchasing

Bernard M. Hoekman · Bedri Kamil Onur Taş

91 citations0/0 files storedSmall Business Economics

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Public Procurement and Policy Law, Economics, and Judicial Systems Auction Theory and Applications

Abstract

Abstract This study investigates the relationship between regulatory policies governing public procurement and participation by small and medium enterprises (SMEs), using a large dataset on European procurement. We find that better quality procurement regulation is associated with greater SME participation and higher probability that SMEs win contracts. Dividing contracts into smaller lots, a key feature of 2014 EU procurement regulation reform, bolsters participation by SMEs but only increases the probability of SMEs winning contracts for small value lots (€25,000 or less). Our results suggest governments seeking to enhance participation by SMEs in public procurement without explicitly favoring SMEs can do so by improving the overall quality of procurement processes.

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References

1991The Competitive Advantage of Nations 1990The Competitive Advantage of Nations 2006Small and medium-size enterprises: Access to finance as a growth constraint 2019Entrepreneurial ecosystem elements 2007Public procurement and innovation—Resurrecting the demand side 2007Small and Medium Enterprises Across the Globe 2018Innovation, Reallocation, and Growth 2009Innovation on demand—Can public procurement drive market success of innovations?

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2024Government procurement contracts, external audit certification, and financing of small- and medium-sized enterprises 2023Participation of women-owned SMEs in public procurement: the role of entrepreneurial orientation and knowledge management orientation 2024Policies for Creating Entrepreneurial Ecosystems

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