Open AccessDETERMINANTS OF SME ACCESS TO PUBLIC PROCUREMENT: EMPIRICAL EVIDENCE FROM THE VISEGRAD GROUP COUNTRIES
Author(s) -
Peter Nemec,
Peter Džupka
Publication year - 2021
Publication title -
proceedings of cbu in economics and business ...
Language(s) - English
Resource type - Journals
eISSN - 2695-0707
pISSN - 2695-0693
DOI - 10.12955/peb.v2.257
Subject(s) - call for bids , procurement , business , multinomial logistic regression , value (mathematics) , empirical evidence , industrial organization , marketing , finance , machine learning , computer science , philosophy , epistemology
This article aims to investigate the factors influencing the success of small and medium-sized enterprises (SMEs) in public procurement in the Visegrad Group Countries. According to the European Union, tools such as the division of contracts into smaller lots or the evaluation of tenders based on the most economically advantageous tender (MEAT) increase the chances of SME’s winning contracts in public procurement. In particular, the evaluation of tenders based on MEAT rather than the lowest price is a tool favoring SMEs, as it boosts their innovative potential, which creates the preconditions for achieving the best value for taxpayers' money. By analyzing more than 150,000 contract award notices published in the Tenders Electronic Daily in 2019, we found a positive effect on SMEs' chances of winning a contract when using framework agreements or dividing contracts into smaller lots. Moreover, the results of multinomial logit regression suggest that the evaluation of tenders based on MEAT rather than lowest prices increases the chances of SMEs to win the contract by more than 50%. However, the findings that the share of SMEs in the total financial value of contracts is less than 20%, with SMEs winning more than 60% of all contracts, suggest that some obstacles of SMEs' access to public contracts, such as financial, administrative or technical complexity of projects may persist and require further research.