The Impact Of Public Procurement Law To The System Of Public Finance

Public procurement law lays out the processes and procedures that public agencies, authorities, or departments should follow when procuring work or service using public funds. The law stipulates the threshold at which public entities should use public procurement instead of private procurement. Effe...

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Bibliographic Details
Published inGlobal economic observer Vol. 7; no. 1; pp. 127 - 137
Main Authors Pospisil, Richard, Kunz, Philipp, Krocil, Ondrej
Format Journal Article
LanguageEnglish
Published Bucharest Nicolae Titulescu University Editorial House 01.06.2019
Nicolae Titulescu University
Subjects
Budget deficits
Competition
Cost control
crowding-out effect
Electronic procurement
Financial management
Financial planning
Government contracts
Government purchasing
Government spending
Investors
Law
Private sector
Public debt
Public finance
Public procurement law
Public sector
Public services
Quantitative analysis
Regulation
Research design
Studies
Taxation
Kenya
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Summary:Public procurement law lays out the processes and procedures that public agencies, authorities, or departments should follow when procuring work or service using public funds. The law stipulates the threshold at which public entities should use public procurement instead of private procurement. Effectively, public agencies spend a considerable amount of government revenue on public services. However, controversy exists on the relationship between government spending and private sector investment. It also remains unclear as to whether public procurement law improves financial management. Thus, the purpose of this study is to determine the relationship between public procurement law and the crowding-out effect, taxes, and finance. The study relies on quantitative research design where data was collected from a sample of 130 participants who comprised of public procurement officials, private investors, and the public. Using a questionnaire, the findings showed that public procurement law increases government spending that in turn crowds out the private sector instead of crowding-in. The need to fund projects often compels government to increase taxes and in turn incur budget deficits due to lack of adequate finances. However, public procurement laws enhance financial planning and control.
ISSN:2343-9742
2343-9750