Abstract
The United States government is the world’s largest buyer, spending over $541 billion on contracts in fiscal year 2018 (U.S. GAO, 2019). The financial magnitude alone of contract expenditures-- accounting for 40% of the government’s discretionary spending and equating to over 2.7% of the gross domestic product of the U.S.--should generate wide interest in understanding the dynamics of the federal contracting ecosystem. Changes in federal acquisition policy create ripple effects in policies governing state and local government acquisition, and can alter the competitive market for acquiring public goods and services. The importance of federal contracting goes beyond its economic influence as acquisition policies generate political and social impact, such as regulations preferencing small business, veterans, women, and other underrepresented groups (e.g., set aside contracts, mentor-protégé program, etc.). Taken together, these factors motivated this special issue to advance scholarship in federal contracting.
Sound research informs policy and practice. To the extent that federal contracting policy and practice can be equipped with solid empirical and theoretical foundations, the extent and impact of poor contracting outcomes—waste, inefficiency, erosion of trust in federal institutions, among others—can be lessened. Considering federal contracting’s multi-faceted nature as simultaneously a political, managerial, social, economic, and technological activity, it presents rich and varied opportunities for scholarship, such as contracting workforce development, contracting organizations, metrics for contracting outcomes, “make or buy” decisions, and many more (Schooner, 2010).
Each article in this special issue provides a unique perspective to inform our understanding of contract performance, supplier competition, and contract narratives. The article by Benjamin M. Brunjes illustrates how contracts with different payment schemes (firm-fixed price, time-and-materials, and cost-reimbursement) can create distinct performance incentives for suppliers. Gregory Sanders and Zachary Huitink present an alternative perspective on contract performance, testing the effects of market concentration on competition and performance. Both Brunjes and Sanders and Huitink developed a large-scale dataset of contracts from the Federal Procurement Data System (FPDS), a publicly-available data source of unclassified federal contracts. In our final article, L. Maria Ingram and Laura S. Jensen weave a rich narrative of the voice of the state in federal contracts. They treat federal contracts as artifacts that reflect societal norms and values and capture the discretionary and non-discretionary actions of the state through its contracts.
In recent months, the Supreme Court, Congress, and the executive branch in the Trump administration have enacted significant changes to federal acquisition and its stakeholders. The examples that follow underscore the need for scholarly attention, illustrating the potential effects on suppliers, competition, antitrust, and transparency, equity and other public values. – The Small Business Runway Extension Act of 2018. Law extends the lookback period for small businesses to quality as small from a three-year rolling average of revenues to five years (H.R. 6330, 2018). The policy effectively smooths effects of growth to allow for a longer period for suppliers to grow to “other than small” where they compete in the open market, or to accommodate outlier revenues among small businesses wishing to remain small. – Food Marketing Institute v Argus Leader Media. Judgment issued by the U.S. Supreme Court in 2019 that clarifies the definition of “confidential,” protecting private entities from the government disclosing information via the Freedom of Information Act that could be competitively harmful. (
Food Marketing Institute v Argus Leader Media, 2018). – Fair Pay and Safe Workplaces. Congress overturned a Department of Labor rule that applied to contracts valued at $500,000 or more that required contractors disclose safety and labor law violations, rejecting policies enacted by the Obama administration (Kindy, 2017). – Procurement Collusion Strike Force. In 2019, Department of Justice established new interagency partnership aimed at preventing and prosecuting antitrust violations among government contractors (U.S. DOJ, 2020). – Low Price Technically Acceptable (LPTA) restrictions. The 2019 National Defense Authorization Act imposed federal government-wide limitations on using LPTA source selection criteria in response to increasing criticisms that LPTA procurements have inhibited the government’s ability to make beneficial cost and performance tradeoffs (Oliver and Ralph, 2018).
As third parties continue to dominate the provision of public services in the U.S., our hope is that the articles in this symposium will provoke more research in this space, pushing the boundaries of empirical, conceptual, and normative research in federal contracting. Strengthening our understanding of the factors at work in the policy domain, the public buyer-supplier relationship and tertiary effects of these dynamics, will inform policymaking, management practice, and scholarship.