Factors influencing savings from electronic auctions

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JEL classification

• National Government Expenditures and Related Policies: Procurement
• Production Management

Keywords

Electronic auctions, Non-parametric tests, Public procurement, savings

Abstract

The ratio of public procurement undertaken through reverse electronic auctions is increasing rapidly. Czech and Slovak municipalities use this tool to save public funds through fostering direct competition between suppliers and to increase transparency. The main aim of this paper is to analyse the savings achieved through e-auctions and the factors influencing these. Five variables are tested to establish whether they influence the savings: num-ber of participants (potential suppliers) in the e-auction, total value of the e-auction, size and country of origin of the municipality, and category of the procured product or service. Several methods are used to test independence. All of these factors except the country of origin influence the savings gained, which is in accordance with the findings of existing research.