Procedural Rigidity and Adaptive Procurement: A Transparent Decision Model

Abstract

Procurement policy, workflow, competition, and contract design are related but distinct. ProcuraCost 2.2.2 corrects an earlier model that collapsed them into one rigidity index and therefore overstated what the cited literature supported. The revised model compares a formal/sequential path with an adaptive/compliant path under the same legal and governance boundary. It reports a central estimate and a wide scenario interval that may favor either path.

The Tunnel–Field proposition remains a conditional hypothesis: adaptability is valuable when avoidable delay and adaptation costs exceed the governance value of formal competition and control. It is not a universal empirical finding.

What changed

• Competition effectiveness, contractual rigidity, workflow burden, TCO capture, and bypass are separate constructs.
• Public-sector comparisons stay inside PZP; an adaptive path is not a lawful-exemption shortcut.
• The unsupported 10%-per-year / 30% TCO rule and invented bypass sigmoid are removed.
• Tool cost is equal when both paths use the same technology.
• Mandatory PZP publication and standstill periods remain identical in both paths.
• Weak quantities appear as broad scenarios, not precise predictions or confidence intervals.
• The combined uncertainty envelope crosses zero in all ten fixed reference scenarios.

Evidence corrections

Szucs (2024) studies Hungarian public procurement with substantial sorting around a value threshold of about 25 million HUF. The structural estimates report roughly a 6% price effect and about 10% lower average contractor total factor productivity under discretion; the invalid raw discontinuity reports roughly 32%. The model monetizes price only; adding productivity again would require an unsupported conversion and risk double counting. Because the effect is identified below that threshold, transferring it to EU-threshold procurement is a scenario rather than a measurement.

Beuve, Moszoro, and Spiller (2023)estimate contractual—not procedural—rigidity using 2SLS/IV in French car-park contracts. Their 0.077–0.105 result is an increase in formal amendments per contract-year for a simultaneous one-standard-deviation increase in each of seven rigidity categories, not an event probability. ProcuraCost's 0–1 profile has no empirical conversion to that shift, so the coefficient is a calibration assumption with an external order-of-magnitude anchor, not a transferred estimate.

Theory from Lipsky, Vaughan, and Holmström–Milgrom supports possible workaround mechanisms but supplies no bypass probability. Practitioner case studies motivate mechanisms only; they do not identify causal effects and are not evidence about Polish public-procurement law.

Seven-dimension model

ΔC = C_formal − C_adaptive = Σ ΔC_i

1. Staff effort: total activity hours by role and loaded rate; headcount is descriptive.
2. Administration: non-labor overhead on active days plus equal technology cost.
3. Delay: elapsed days times user-supplied cost of inaction.
4. Selection risk: price-premium scenario times residual competition risk.
5. Formal amendments: annual contract-rigidity frequency times event cost and a discounted annuity factor.
6. TCO: a three-year cumulative pool converted to a discounted annual flow; central pool is zero.
7. Bypass: scenario rate times user-supplied exposure and system controls.

Interpretation

A positive ΔC favors the adaptive path; a negative value favors the formal path. If the displayed scenario interval crosses zero, assumptions determine the winner. If it does not, the sign is stable only within the declared bounds—not statistically proven.

The break-even threshold is the daily inaction cost at which the central result changes sign. Above it, the faster path in the selected profile has the lower modeled total — and that path is not always adaptive.

Formality can dominate when delay is cheap, competition materially constrains favoritism, requirements are stable, and adaptive governance capability is weak. Adaptability can dominate when delay is costly, competition is preserved, and requirements or contracts must evolve as information arrives.

Legal boundary

From 1 January 2026, the Polish PZP application threshold is 170,000 PLN net. The optimizer uses the applicable 2026–2027 EU threshold according to procurement object and authority level: 603,400 PLN, 930,960 PLN, or 23,291,240 PLN. In the national band, Arts. 266 and 275 restrict the default recommendation to the basic mode. At or above the EU threshold, the default filter offers only open and restricted tender under Art. 129(2); special procedures require a separate assessment of statutory grounds. The tool is illustrative and is not legal advice.

References

• Szucs, F. (2024). Discretion and Favoritism in Public Procurement. JEEA, 22(1), 117–160. DOI: 10.1093/jeea/jvad017.
• Beuve, J., Moszoro, M. W., & Spiller, P. T. (2023). Doing It by the Book: Political Contestability and Public Contract Renegotiations. JLEO, 39(1), 281–308. DOI: 10.1093/jleo/ewab039.
• Coviello, D., & Mariniello, M. (2014). Publicity Requirements in Public Procurement. Journal of Public Economics, 109, 76–100.
• European Commission (2011). Public Procurement in Europe: Cost and Effectiveness.
• Fazekas, M., & Blum, J. R. (2021). Improving Public Procurement Outcomes. World Bank WPS 9690.
• Holmström, B., & Milgrom, P. (1991). Multitask Principal–Agent Analyses. JLEO, 7, 24–52.
• Lipsky, M. (1980). Street-Level Bureaucracy. Russell Sage Foundation.
• Vaughan, D. (1996). The Challenger Launch Decision. University of Chicago Press.

Full formulas, scenario bounds, and validation rules are maintained in the repository's RESEARCH.md and docs/MODEL_PARAMETERS.md.