Firms’ Qualifications and Subcontracting in Public Procurement: An Empirical Investigation

Luigi Moretti and Paola Valbonesi

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Abstract: Using a newly assembled dataset, we empirically investigate the effects of subcontracting on procurement auction prices in Italy. In this setting, the pre-qualifications required for firms aiming to bid on public contracts determine the firms' different subcontracting formats. We find that fully qualified firms in a position to choose whether to subcontract generally offer lower prices than partially qualified firms, which must proceed with mandatory subcontracts. This result indicates that the firms' voluntary arrangements tend to improve market performance, while imposed arrangements tend to worsen market performance, in the public procurement supply-chain.

Keywords: Subcontracting; Public procurement; Supply chain (search for similar items in EconPapers)
Date: 2015-02-11
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Citations: View citations in EconPapers (9)

Published in Journal of Law, Economics, and Organization, 2015, 31 (3), pp.568-598. ⟨10.1093/jleo/ewv001⟩

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Journal Article: Firms’ Qualifications and Subcontracting in Public Procurement: An Empirical Investigation (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01441874

DOI: 10.1093/jleo/ewv001

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