Article 7

Title

Centralization vs. Bundling: The Victory of an Italian David against an Italian Goliath

Author

  • Gustavo Piga – [email protected]
    Ph. D. in Economics at Columbia University, Full Professor of Economics at the University of Rome Tor Vergata, where he chairs the International Master in Public Procurement Management. He has chaired the Italian Procurement Agency for Goods and Services, Consip Ltd., between 2002 and 2005. His fields of expertise are public procurement, macroeconomics and public debt management. He is the editor of several books, among which of the Handbook of Procurement, Cambridge University Press, with Nicola Dimitri and Giancarlo Spagnolo and of Revisiting Keynes: Economic Possibilities for our Granchildren, MIT Press, with Lorenzo Pecchi. He is member of the Scientific Committee of the Parliamentary Budget Office. Blogs at www.gustavopiga.it

Abstract

By drawing on the data and evidence related to a recent annulment, following the complaint of a small local SME, in an Italian administrative court of a large, limited-lots, tender published by the Italian largest Central Purchasing Body, we review the evidence for aggregation and bundling strategies of public procurement tenders in the light of the negative impact they generate on SME participation. We conclude by suggesting that an optimal strategy of centralization, which has several benefits, to survive requires limiting its bundling temptation.

Keywords

Centralization; bundling; sme; lots; central purchasing body; procurement tenders