The Problem of Noncompetitive Behavior in Public Purchase

Currently procurement system in Russia is considered to be an efficient tool to spend budgetary funds and to satisfy governmental and municipal needs for goods, works and services. In 2015 the total value of contracts, signed through the procurement system, exceeded 5.3 trillion. rub., which is more than 10% of Russian GDP. However, practically the important principles of the procurement system are not implemented in all cases. Despite the recent novels of procurement legislation the total value of irregularities continues to grow. In 2015 violations totaled 142.5 billion rubles, compared to 47 billion in 2014. One of the possible reasons for violations of the procurement legislation is supposed to be the noncompetitive interaction between the main participants of the public purchase: buyers and suppliers. The research agenda of the author focuses on the analysis of the vertical and the horizontal interactions between the participants of the procurement process by means of econometrics (fuels and lubricants market of Moscow region as an example). The empirical data for the analysis consists of the information about the fulfilled purchases of oil-products in 4 neighboring districts of Moscow region: Orehovo-Zuevo, Pavlovskiy Posad, Egorievsk and Shatura in the period of 2007-2011. In spite of the fact that during 4-years period any proceedings on the grounds of violation of the competition rules were not initiated, the empirical results allow to suppose the presence of the sustainable noncompetitive repeated interactions between the buyers and the suppliers of the considered market.