Choose Your Battles Wisely: The Consequences of Protesting Government Procurement Contracts

Mehmet I. Canayaz (), Jess Cornaggia () and Kimberly Cornaggia ()
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Mehmet I. Canayaz: Pennsylvania State University, University Park, Pennsylvania 16802
Jess Cornaggia: Pennsylvania State University, University Park, Pennsylvania 16802
Kimberly Cornaggia: Pennsylvania State University, University Park, Pennsylvania 16802

Management Science, 2025, vol. 71, issue 10, 8526-8548

Abstract: We examine the relationship between a firm’s successful protest of a government agency’s conduct or terms of a procurement contract and the amount of business the firm conducts with the government going forward. We find firms receive fewer and less valuable government contracts, face more contract cancellations, and experience significant reductions in sales growth and employee growth. Despite widespread belief, successful bid protesters do not delay government procurement because of lengthy dispute resolutions. Overall, we provide the first analysis of corporate interactions with the United States government bid protest system.

Keywords: bid protests; contracting; government contracts (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:71:y:2025:i:10:p:8526-8548

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