Public procurement, competition and protection of the state's financial interests

Ádám Török, Ágnes Győrffy and Ilona Hernádi

Public Finance Quarterly, 2007, vol. 52, issue 1, 5-36

Abstract: What would Michelangelo's Pieta or David be like if they had been procured under the rules relevant for government contracts in the early 2000s in Hungary? What would have happened if Michelangelo Buonarotti had been excluded from the procedure, because he had failed to submit the copy of the certificate to prove his qualifications when corrections were requested? What would the London Saint Paul's Cathedral, the Chartres Cathedral, the Redoute of Budapest and the House of Parliament look like if a public procurement procedure had been launched for their construction? Why so many allegations, rumours and accusations and often unverified, but unceasing suspicion of corruption in connection with the Hungarian public procurement procedures? Would it really be the necessary, but costly (and according to some, not really effective) tool to reduce corruption? In our paper we are seeking answers to these questions. It makes the study of the subject area of public procurement more difficult that researches conducted in this field are not detailed and comprehensive enough, thus offering very few fixed points for the further analysis of the topic. The majority of Hungarian researches approach this issue from a legal point of view. On the other hand, we have embarked on elaborating the subject (i.e. the system of procurements conducted from public finance resources) expressly as an economic question. After reviewing the theoretical background, and by outlining the state of affairs of the Hungarian public procurement market, the research wishes to present alternatives for the possible development paths.

Date: 2007
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