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Understanding factors associated with the decision not to bid – empirical tests and strategies for improving public procurement
Journal article   Peer reviewed

Understanding factors associated with the decision not to bid – empirical tests and strategies for improving public procurement

Emily Boykin, Clifford McCue, Christopher L. Atkinson and Eric Prier
Journal of public budgeting, accounting & financial management, Vol.first online publication
09/08/2025
DOI: https://doi.org/10.1108/JPBAFM-09-2024-0173
Web of Science ID: WOS:001564909800001

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Abstract

Purpose Despite government efforts to increase the number of bids submitted on contracts, many bids receive a limited number of responses and a significant number of bids receive no offers. While the literature has identified various reasons why businesses do not submit bids, previous research has not empirically validated nor systematically examined these reasons. This study applies transaction cost theory to understand bidding barriers from both buyer and supplier viewpoints. Design/methodology/approach After systematically reviewing the literature to identify reasons businesses claim why they don’t bid on government contracts, we use US federal contracting data to determine if those stated reasons are empirically supported. Findings Validation of business criticism concerning the accessibility of government contracting opportunities is mixed, suggesting governments strategically tailor contracting opportunities across sectors and policy choices to increase or optimize market competition. Originality/value In linking buyer and supplier perceptions of bidding, findings from our mixed methodology propose that future public procurement research focus on how solicitation barriers, government bidding strategies and industry sectors shape transaction costs for both buyers and suppliers.

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