Scale effect at ProZorro public procurement system: the expected effect of centralization

Kateryna Marushchak, Adam Hashchyshyn, Oleksandr Sukhomlyn and Andreii Tarasenko ()
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Andreii Tarasenko: Kyiv School of Economics

Modern Economic Studies, 2019, vol. 2, issue 1, 81-89

Abstract: The centralization of public procurement can be the source of a reduction in public spending due to the scale effect. To investigate its effect in public procurement, the relationship between the volume of tender procurement and the price per unit of goods under the contract for 12 commodities of the food industry was analyzed. As a result of the research, it was discovered that an increase in purchases by centralization could reduce the price per unit when purchasing flour, beet, cabbage, potatoes, pork, onions, apples and beef, while for purchases of sugar, pasta and butter of high value the effect was not observed. This suggests that the centralization of public procurement can increase the efficiency of using budget funds, which is consistent with the objectives of the ProZorro project.

Keywords: public procurement; Prozorro; scale effect; centralization (search for similar items in EconPapers)
JEL-codes: D44 D49 H57 (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:kse:modern:v:2:y:2019:i:1:p:81-89

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