Fiuza, Eduardo Pedral Sampaio de Medeiros, Bernardo Abreu
Year of Publication:
Texto para Discussão, Instituto de Pesquisa Econômica Aplicada (IPEA) 1990
Raising the public administration's efficiency is, without any doubt, one of the greatest challenges nowadays in Brazil. The State's technical and allocative efficiency dimensions necessarily require efficiency of public agencies in the acquisition of inputs for their production and supply functions of public goods and services to the population. However, unlike private firms, the State generally follows stricter criteria in selecting suppliers and pricing their purchases, as their purchases must abide to such criteria as impartiality, equality and publicity, and must follow strict legal rules. The Brazilian public procurement legislation is now 21 years old and shows clear signs of exhaustion the main Public Procurement Act is both too detailed and outdated with respect to the best practices. The institutional framework and human capital involved should also be reviewed and strengthened. Invited by the Brazilian Senate to contribute to the reform of this institutional framework, IPEA submitted proposals that are exposed here in greater depth of analysis and with a better grounding based on sound economic theory and evidence and on a broad international benchmarking of institutional frameworks. They can be summarized as follows: i) consolidation of the multiple laws existing today in one piece of legislation; ii) creation of normative and executive agencies for public procurement, with appropriate personal career profiles and equipped with adequate incentives; iii) gradual transition of the current regulation of bidding formats and other rules to the new normative agency regulations.
public biddings public procurement economic regulation auctions institutional design