Business Reporting - Business Statistics by G T Geis

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Formal rules include regulation of competition and tendering procedures and of public sector activities in general. The informal rules and attitudes surrounding contracting attempt to describe how contracting is perceived in the public sector and among the public, how accepted the use of contracting is among public sector organizations, and how public-private interaction is perceived and placed in the political debate. We suggest the following elements to describe the contract culture: • • • • • National/international legislation—the regulatory praxis The history of contracting in the public sector The nature and level of public-private interaction The political debate surrounding contracting Attitudes toward contracting—in the public sector and among the public The Regulatory Praxis The national and international legislation surrounding the process gives the formal framework for contracting services.

Some obstacles to competition may be found within the organization itself. Bureaucratic procedures may cause potential bidders to abandon the process. Hence, governments must make it easy for private companies to participate in order to increase competition. Savas (2000) suggests dividing the contract into smaller pieces either geographically or functionally. He also mentions the need to give sufficient information to bidders, to let more than one single bidder be successful, and to spread the contracts over several years in order to let losers from the first round be successful in a following round of bids.

With the different logics of action we find a similar story. In some instances, actors may follow the logic of consequentiality, and they need to be faced with that in negotiations. In other instances, actors may follow the logic of appropriateness. There is not necessarily only one best way to conduct a contractual relationship. For academic analysis, the type of contracts and the actors’ strategies must be identified. The practioner, the principal, the agent, or simply the partner must take into account what kind of contract they are being regulated by (or will regulate by) and what kind of strategies the other party is intending to follow.

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