A REVIEW OF AIR FORCE PROCUREMENT, 1962-1964.
Abstract
Conclusions: The goal of procurement is to obtain the goods and services needed for the Air Force's mission at economically optimal prices. Only 2 per cent of the total obligations studied were explicitly justified on socio-political grounds. Military procurement, differs from many other public policies, such as urban renewal or poverty eradication, where non-economic factors play vital roles. Procurement also differs from many of the regulated industries where the goal is a 'fair' price, with 'fair' having primarily a legal rather than an economic definition. The method used by the Air Force to obtain economically satisfactory procurement results usually is negotiation. Formal advertising is seldom used, and, considering the items purchased by the Air Force, it is hard to see how it could ever be a major method of purchasing. In the negotiation process, design and technical rivalry usually determine which potential supplier will receive the contract. Formal price competition plays only a minor role as a contractor selection criterion. The most important explanation given by contracting officers of the need for negotiating contracts is that prior investment in a program has 'locked-in' the government to a particular supplier.
Document Details
- Document Type
- Technical Report
- Publication Date
- May 01, 1965
- Accession Number
- AD0615655
Entities
People
- George R. Hall
- Robert E. Johnson
Organizations
- RAND Corporation