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Maintaining Competition in Recurrent Procurement Contracts: A case study on the London Bus Market

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Abstract

Under recurrent procurement, the awarding of a contract to a firm may put it in an advantageous position in future tenders, which may reduce competition over time. The objective of this paper is to study the dynamics of competition for tendered contracts, focusing on factors that may generate incumbent advantage. Particular attention is given to learning economies, sunk costs of entry and switching costs for the procurer. The paper then applies these insights to analyse empirically the evolution of competition in the market for local bus services in London.

Suggested Citation

  • Elisabetta Iossa & Michael Waterson, 2017. "Maintaining Competition in Recurrent Procurement Contracts: A case study on the London Bus Market," CEIS Research Paper 400, Tor Vergata University, CEIS, revised 24 Feb 2017.
  • Handle: RePEc:rtv:ceisrp:400
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    References listed on IDEAS

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    More about this item

    Keywords

    Dynamic Competition; Procurement and Incumbent advantage;

    JEL classification:

    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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