Each year, billions of dollars are spent on public infrastructure projects which are often plagued by over-running costs, poor quality, or time delays. This column focuses on an under-studied dimension of contract structure in public procurement, namely, whether the various components of a major project are bundled together or tendered separately. The findings suggest that a bundled contract will be preferred when policymakers want to prioritise timely completion, whilst unbundled contracts may be preferred when policymakers want to prioritise infrastructure resilience.
Article
How contracting structures affect project outcomes in public procurement
Susanna B. Berkouwer Eric Hsu Edward Miguel Catherine Wolfram
VoxEU / CEPR
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