Submitted February 2009.
Competition, Quality and Contract Compliance: Evidence from Compulsory Competitive Tendering in Local Government in Great Britain, 1987–2000*
Article first published online: 6 DEC 2012
© 2012 The Authors Fiscal Studies © 2012 Institute for Fiscal Studies
Volume 33, Issue 4, pages 513–546, December 2012
How to Cite
Milne, R. G., Roy, G. and Angeles, L. (2012), Competition, Quality and Contract Compliance: Evidence from Compulsory Competitive Tendering in Local Government in Great Britain, 1987–2000. Fiscal Studies, 33: 513–546. doi: 10.1111/j.1475-5890.2012.00171.x
The authors wish to acknowledge the Nuffield Foundation for financial support from its Social Sciences Small Grants Scheme number SGS/00591/R and the Local Government Management Board for making the CCT database available.
The following have helped in various ways at various times: Bob Davidson, Gavin Hutton, Gary Koop, Kenny Lang, Dilys Leckie, Charles McIver, David McLeish, Camilla Mastromarco, Roger Mills, Gail Pain, Jon Sutcliffe, Jo Swinson, Nigel Taylor and Rodney Thornton. The authors are grateful for the advice of the two anonymous referees and the editor, Gareth Myles. The views expressed are of the authors alone, who take responsibility for the information given and the conclusions reached.
- Issue published online: 6 DEC 2012
- Article first published online: 6 DEC 2012
- contract compliance;
- contract performance;
- competitive tendering;
- local government;
- auction theory
The introduction of competition has frequently been found to cause costs to fall. There has, however, been a question as to whether this was partly achieved at the cost of quality. Auction theory predicts prices would fall more the greater the competition to provide the service. There has been some debate about whether the smaller budgets would make contract compliance more difficult. Evidence is found in support of this hypothesis. We also find some evidence that the better recorded performance of the in-house direct service organisations (DSOs) during this period was due to the information advantage they had from being incumbents.