Economic Incentives and the Defense Procurement Process

William P. Rogerson

No 1078, Discussion Papers from Northwestern University, Center for Mathematical Studies in Economics and Management Science

Abstract: This paper descrives some of the insights that the economic theory of incentives can contribute to defense procurment policy analysis. It descrives the underlying incentive problems that shape the defense procurement problem, the nature of current institutions and how they affect actors' behavior, and possible directions for improving the procurement process suggested by viewing it as a solution to a complex set of incentive problems. Incentive problems between government and defense firms and incentive problems within government are both considered.

Date: 1993-12
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