Experiments in Public Procurement: Italy Buys in Bulk Sequel

Under pressure from the European Union, which had reluctantly accepted Italy into the “Eurozone” on the condition that the country control its deficit spending and reduce its high national debt, Italy’s central government launched dozens of austerity programs. in the late nineties and early nineties. 2000. One of these programs aimed to save billions of euros in public procurement of goods and services. The first priority of the program was to identify products and services that were being purchased by public entities at all levels of government and consolidate them into mega-contracts at the national level. Analysts argued that by aggregating public sector demand in this way, Italy’s public sector could significantly increase its market leverage and obtain deep discounts from suppliers. This assessment turned out to be correct, but also politically explosive. In November 2003, the Italian Minister of Economy and Finance ordered the temporary suspension of the program to allow political and administrative leaders to decide what to do. Case number HKS 1925.1

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