The Theoretical Underpinnings of Hybrid Procurement Techniques

2010
Michael Regan (Bond University)

Project Summary

This research will examine the theoretical principles that operate with hybrid procurement techniques such as public private partnerships, alliance contracts, long-term outsourcing contracts and various applications of the design, build, finance and operate procurement method. There is growing evidence that suggests hybrid procurement mechanisms are delivering better outcomes than traditional lowest-price tender method, which is the technique preferred by governments and state agencies.
 

This research will identify the theoretical principles that underpin traditional procurement commencing with the objectives and motivation of public agencies (public choice theory), auction theory, privatisation, incentive frameworks and the economics of information, the role of capital market disciplines, incomplete contract theory and the coarse theorem applied to the valuation of proprietary interests and externalities.

The objective of this research will be to develop a better understanding of the performance differences between the different methods of major project procurement and the delivery of public services.