Change as a cost driver in defence procurement

Maria Hedvall *

Defence and Peace Economics, 2004, vol. 15, issue 1, 101-108

Abstract: This paper discusses change transactions that occur in connection with the procurement of defence systems. The bases for the reasoning are the ideas of Miller and Vollman (1985) and Eppinger (2001). These researchers argue that unplanned flows of information lead to change transactions, causing significant overhead costs. According to this paper, change transactions in defence procurement could be caused by (a) the changes in technology taking place during the long lifetime of a defence system and (b) the structure and contents of the agreements between the defence agent (the procurer) and the defence industry (the supplier).

Date: 2004
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DOI: 10.1080/1024269042000164522

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