Government Contracts and Contractor Behavior |
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Authors: | Ruben Berrios |
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Institution: | (1) Department of Economics, Still Hall, College of Business, Clarion University, 840 Wood Street, 16214 Clarion, PA, USA |
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Abstract: | The U.S. government embraces the concepts of privatization and market competition, but the realm of contracting shows that
it has not always been able to put its principles into practice. Although the contracting system is supposed to be open and
competitive, in recent years the government has often awarded contracts with little or no competitive bidding, has chosen
to award mostly cost-plus type contracts that force the government to assume more of the risk, and lacked efficiency in monitoring
and overseeing private contractors. While the number and value of contracts have increased, the workforce to oversee these
contracts has been reduced, preventing the government from adequately enforcing compliance with the contractors, and the government
has not made use of past performance evaluations in its contracting system. Private contractors that do business with the
U.S. government are for the most part well-established firms with ample resources and inside contacts; many contracts are
still being awarded on preferential treatment and to the larger and well-established contractors. |
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Keywords: | contracting contractor behavior cost-overruns government procurement past performance |
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