3(34)
Abstract
The single-most important parameter of a public procurement system is the
threshold above which the framework applies. The optimization problem
consists of finding a reasonable trade-off between the gains from public
procurement and the administrative costs associated with procurement
rules. In the present study, based on a sample of central and local
government procurement operations in Sweden, an optimal threshold value
in the range 5–6 000 EUR is computed based on the requirement that the
average gain should supersede the average cost. If a larger proportion of
procurements is required to gain from the regulation imposed, a threshold
value of 20–25 000 EUR results. The general conclusion is that there are
strong arguments for maintaining procurement rules below the EU
threshold.
Accepted for publication in the
Journal of Public Procurement
