Journal of Purchasing and Supply Management 26 (2020) 100622

Contents lists available at ScienceDirect

Journal of Purchasing and Supply Management

journal homepage: www.elsevier.com/locate/pursup

Price/time/intellectual efficiency of procurement: Uncovering the related T

factors in Chinese public authorities
Qi Wang, Renjie Zhang, Junqi Liu∗
School of Economics and Management, Southwest Jiaotong University, Chengdu, Sichuan, 610031, PR China

A R T I C LE I N FO A B S T R A C T

Keywords: High efficiency is one of the important goals of public procurement (PP); however, research on PP efficiency is
Public procurement (PP) still not sufficient, especially in the context of developing countries. With a focus on the purchasing phase, this
Efficiency study measures three aspects of procurement efficiency of public authorities: price, time and intellectual effi-
Procurement efficiency ciency. The relevant factors of these three aspects are explored and examined. 838 PP contracts in Chengdu city,
Green public procurement (GPP)
China were collected in the first half of 2018 using a web crawler programme. Regression method is used to
Public authorities
China
analyse the data. This study finds that the price efficiency of PP is negatively associated with the implementation
of green public procurement (GPP) but is positively associated with the evaluation method (the weight of
bidding price during evaluation) and the number of bidders. Time efficiency is negatively associated with GPP
implementation. Intellectual efficiency is negatively associated with the size of the procurement. This study
accomplishes the following: I. extends research to a still relatively unexplored context: developing countries; II.
adds to the studies on public procurement efficiency; and III. investigates the influence of GPP implementation
on PP efficiency in a developing country.

1. Introduction
For many countries around the world, public procurement (PP)
accounts for a large proportion of the national economy. In 2011, the
total expenditures of PP in the European Union (EU) accounted for 19%
of its gross domestic product (GDP) (Kutlina-Dimitrova and Lakatos,
2016), whereas the same proportion was achieved by Sweden in 2008
(Bergman and Lundberg, 2013). In 2018, the size of the Chinese public
authority in terms of procurement reached about 3.6 trillion yuan
(512.8 billion US-dollars). Because of its considerable procurement
power, PP is becoming more and more important in the trade nego-
tiation agenda of the World Trade Organization and in bilateral pre-
ferential trade agreements (Kutlina-Dimitrova and Lakatos, 2016). Re-
search shows that PP plays an important role in promoting innovation,
sustainable development and government-enterprise relationships
(Uyarra and Flanagan, 2010; Preuss, 2013; Erridge and Greer, 2010).
Pursuing high efficiency has already been regarded as one of the im-
portant goals of PP in the 1980s (Mcafee and Mcmillan, 1989); there-
fore, enhancing PP efficiency has become a constant concern for both
public authorities and academia (Patrucco et al., 2016).
Previous studies mostly focus on developed countries such as the
United Kingdom (Hackney et al., 2007; Mudyarabikwa and Regmi,
2016), France (Saussier and Tirole, 2015), Italy (Patrucco et al., 2016;
Guccio et al., 2014) and Japan (Ohashi, 2009). Only a few studies focus
on developing countries such as India (Panda et al., 2010) and Russia
(Balsevich and Podkolzina, 2014). Although China is the largest de-
veloping country and has already highlighted high procurement effi-
ciency as one of the legislation goals in “The Government Procurement
Law of P.R.C”, there is still less research based on China. This lack of
studies focused on developing countries represents a research gap in the
field.
Generally, the PP procedure can be divided into three phases: the
planning phase, the purchasing phase and the contract execution phase
(Balaeva and Yakovlev, 2011). Most of the previous studies pay sig-
nificant attention to the purchasing phase and measure PP efficiency
using the procurement price (Tas, 2012; Pavel and Sičáková-Beblavá,
2013; Michal et al., 2016; Balsevich and Podkolzina, 2014; Hackney
et al., 2007). This not only speaks volumes regarding the importance of
the purchasing phase but also indicates that prior studies use simple
measures for PP, which highlights another research gap.
Previous studies examine factors related to PP efficiency, mainly
including competition, decentralization, transparency, evaluation
method, the number of bidders, and the application of e-auctions
(Balsevich and Podkolzina, 2014; Ohashi, 2009; Pavel and Sičáková-
Beblavá, 2013; Michal et al., 2016; Hackney et al., 2007). As an en-
vironmental policy tool (Tarantini et al., 2011), green public

∗
Corresponding author.
E-mail addresses: jqliu697@qq.com, jqliu@my.swjtu.edu.cn (J. Liu).

https://doi.org/10.1016/j.pursup.2020.100622
Received 6 January 2019; Received in revised form 6 April 2020; Accepted 8 April 2020
Available online 12 April 2020
1478-4092/ © 2020 Elsevier Ltd. All rights reserved.
Q. Wang, et al.
procurement (GPP) has been implemented in China for over a decade,
and its usage is still on the rise (Liu et al., 2019b). In 2018, the size of
GPP reached 330.1 billion yuan (47.0 billion dollars) in China. Building
on the insights from Lundberg et al. (2009, 2015), we found that there
is a research gap in terms of understanding the relationship between
GPP and PP efficiency in developing counties and need further em-
pirical study.
Based on these research gaps, this study raises the following re-
search question.
RQ. What drives PP efficiency in China?
To answer the research question above, this study attempts to
measure PP efficiency in the purchasing phase by considering the three
aspects of price efficiency, time efficiency and intellectual efficiency,
taking China as a research background. The related factors of these
three aspects are explored, and relevant hypotheses are developed. This
study examines the hypotheses with data from 838 PP contracts and
finds that price efficiency is associated with the implementation of GPP,
the evaluation method and the number of bidders; time efficiency is
associated with the implementation of GPP; and intellectual efficiency
is associated with only procurement size.
The academic contributions of this study are as follows.
I. This study takes China as the research background using concluded
PP contracts as the data source and extends research to a still re-
latively unexplored context: the developing country.
II. This study adds to previous PP efficiency research by measuring PP
efficiency from three aspects and examining the related factors of
these aspects.
III. This study investigates the influence of GPP (an environmental
policy) implementation on PP efficiency in a developing country.
The remainder of the paper is organized as follows. Section 2 de-
scribes the empirical and literature background. Section 3 presents the
hypotheses development. Section 4 introduces the methodology. Sec-
tion 5 presents results. Section 6 presents academic and practical con-
tributions. The last section is limitations and future research.
2. Empirical and literature background
2.1. Public procurement procedure in China
There are two organizational forms of PP in China: centralized
procurement and decentralized procurement. Centralized procurement
means that public authorities give centralized procurement agencies the
right of procurement. Therefore, the public authority in this study in-
cludes centralized procurement agencies. There are 5 PP channels in
China: purchasing through single-source contracting; requesting quo-
tations; using a competitive dialogue; using restricted invitations to
tender; and using open tendering (Standing Committee of the National
People's Congress, 2002). Since open tendering is the main procurement
channel, this study focuses only on open tendering. In open tendering,
public authorities should invite all the potential and unspecified sup-
pliers to take part in bidding by releasing a purchase announcement;
the procurement contract will be signed with the winning bidder, which
is selected from all the suppliers competing in the open tendering. The
procurement price in the contract is the bid-winning price.
Referring to the classification standard of Balaeva and Yakovlev
(2011) and Caplice and Sheffi (2003), this study divides the PP pro-
cedure into three phases, namely, the planning phase, purchasing phase
and contract execution phase. Although most studies on enterprise
procurement pay attention to the planning phase (Caplice and Sheffi,
2003), studies on PP attach importance to the purchasing phase. In this
light, this study focuses only on the purchasing phase, which is from
publishing the procurement announcement and procurement document
to deciding the winning bidder. The work task in each phase of PP in
China is shown in Fig. 1.
2
Journal of Purchasing and Supply Management 26 (2020) 100622
The system of selecting PP specialists (hereafter referred to as spe-
cialists) is a PP system unique to China. This system can reduce cor-
ruption and collusion in the PP process (Zhao, 2016). Before organizing
the bid opening meeting, public authorities will randomly select (Spe-
cialists can be appointed in some special cases, but this is rare) a certain
number of specialists from their database to act as the evaluation
committee. Then, the selected specialists will grade both the bidding
prices of the bidders and non-price factors (such as the technical plan,
after-sales support, energy conservation and environmental protection.)
according to the method of evaluation specified in the procurement
document. After this, the evaluation committee submits the written
evaluation report to the public authority and recommends the eligible
winning candidates. The public authority will determine the winning
bidder according to the evaluation results or give the evaluation com-
mittee the right to directly determine the winning bidder. This shows
that specialists play an important role in China's PP.
2.2. Literature background
In recent decades, PP, a crucial public activity, has gradually be-
come a research focus (Thai, 2001; Bergman and Lundberg, 2013). The
research directions of the existing PP-related literature can be classified
into the following three categories: issues on the policies and regula-
tions of PP (Jibrin et al., 2014; Vecchiato and Roveda, 2014; Knack
et al., 2017), issues on the functions of PP (Amann et al., 2014; Loader,
2013; Ribeiro and Furtado, 2015; Witjes and Lozano, 2016) and issues
on the practice of PP. Branzoli and Decarolis (2015) empirically studies
how the interplay between entry and subcontracting choices are af-
fected by the use of different auction formats in PP. Uttam and Roos
(2015) study the application of competitive dialogue in sustainable PP.
Aman and Kasimin (2011) study the challenges of e-procurement im-
plementation, such as lack of information technology skills. Patrucco
et al. (2016) study the effectiveness of PP performance management
systems. There are also some scholars who focus on PP efficiency.
Table 1 summarizes some recent empirical studies on PP efficiency from
various geographical domains.
According to Table 1, the research background of previous empirical
studies are mostly developed countries, and only a few are developing
countries. Based on the phase division discussed in Section 2.1, we find
that most of the previous studies focus on the purchasing phase. Among
these studies, a significant research gap is that scholars use different
methods to measure PP efficiency and examine the related factors, but
most only focus on the price aspect of efficiency. However, in PP
practice, efficiency is not only in terms of price, the time aspect of ef-
ficiency (Hackney et al., 2007) and the labour aspect of efficiency
(Balaeva and Yakovlev, 2011) are also very important. These current
research less provide a clear definition and measurement of the effi-
ciency of PP.
Some studies on PP efficiency are not empirical. Mudyarabikwa and
Regmi (2016) believe that other aspects, including the ability to in-
crease the quality of buildings, the drive to maximize value for public
money, the commitment to risk management, and valuing the in-
tegration of services delivered through competition, should be con-
sidered in improving PP efficiency. Moreover, increasing efficiency in
PP depends upon the degree of bureaucracy involved in terms of de-
centralization; decision-making; governance; accountability; and
strong, effective and formal partnerships. Sorte (2017) believes that
centralized procurement can improve the efficiency of PP, especially for
small public bodies. Trybus (2006) is convinced that modern pur-
chasing techniques (dynamic purchasing systems and electronic auc-
tions) facilitate PP efficiency. Panda et al. (2010) analyse the benefits
and obstacles of e-procurement implementation in Indian PP. Saussier
and Tirole (2015) note that transparency, competition and specializa-
tion increase the efficiency of the public procurement system. Lundberg
et al. (2009) think that implementing GPP in the European Union will
reduce the cost-efficiency of PP.
Q. Wang, et al.
Table 1
Some recent empirical studies on PP efficiency.
Author/s
Michal et al. (2016)
Guccio et al. (2014)
Balsevich and Podkolzina
(2014)
Pavel and Sičáková-Beblavá
(2013)
Tas (2012)
Balaeva and Yakovlev (2011)
Ohashi (2009)
Hackney et al. (2007)
Journal of Purchasing and Supply Management 26 (2020) 100622
Fig. 1. Procurement procedure of Chinese PP and phase division.
Location Procurement phase The measurement of PP efficiency The related factors of PP efficiency
Czech Republic Purchasing phase Procurement price Number of offers
Centralized procurement
Type of award procedure
Evaluation method
Italy Contract execution phase Costs overruns and delays Degree of specialization of the
contracting authority
Openness of the tendering procedure
Potential competition
Russia Purchasing phase Procurement price Clauses in the procurement
Characteristics of the market structure
Slovak municipalities Purchasing phase Procurement price Application of e-auctions
Number of bidders
Turkey Purchasing phase Procurement price Number of bidders
Different type of products (services,
goods, construction)
EU and Russian The entire procurement The costs of procurement regulation for public Complexity of the procurement
process customers and private suppliers procedures
Application of e-auctions
Excessive regulation
Japan Purchasing phase Cost and competitiveness of public procurement Transparent procurement procedures
U.K. Planning phase and Cost reductions and organizational efficiency Application of e-reverse auctions
purchasing phase
3
Q. Wang, et al.
It is worth noting that GPP is an important environmental policy
tool (Testa et al., 2016) that contributes to sustainable development and
has demonstrated a relatively mature performance in the developed
world in places like the EU, Sweden, and Germany (Varnäs et al., 2009).
However, GPP was not actively promoted in the developing world until
ten years ago, for example in China and Malaysia (Liu et al., 2019a;
Adela et al., 2014). Current studies do not yet explore whether the
implementation of GPP will influence PP efficiency in the developing
world, they have only made a preliminary discussion on this issue in the
context of developed countries. Thus, this issue deserves more in-depth,
and especially the empirical exploration in developing country.
The study of public procurement efficiency in an developing country
like China is important because of three reasons. Ⅰ. China is the world's
second largest economy, with public procurement reaching 3.58614
trillion yuan in 2018, an increase of 11.7% over the previous year,
accounting for 10.5% of national fiscal expenditure and 4% of GDP.
Saving 1% of the budget can reduce the financial expenditure by 358.61
billion yuan, so the significant public procurement expenditure makes it
important to study how to save the procurement budget. Ⅱ. The re-
levant regulations and procedures of public procurement in China are
not the same as those in other countries. Therefore, the suggestions to
improve the efficiency of public procurement may not be applicable to
China. For example, in addition to saving the procurement budget, we
also need to consider some unique factors, such as the number of
evaluation specialists, which requires the study of Chinese public pro-
curement. Ⅲ. Finally, research on the efficiency of public procurement
in China is not enough, and most of the research methods are qualita-
tive, lack of quantitative research, especially the lack of empirical re-
search based on the actual transaction contract as the source of data.
The improvement of the transparency of Chinese government in-
formation has provided an opportunity for the research on the effi-
ciency of public procurement.
2.3. Public procurement efficiency
This study focuses only on the purchasing phase. We conducted
interviews with participants who are directly involved in this phase.
These participants are three public procurement officials and two spe-
cialists/experts. Appendix A provides a copy of the interview questions
that served as a reference for selecting the aspects of PP efficiency and
the related factors we chose to study.
According to the interviewees, it is widely accepted that saving
more money in the procurement budget is characteristic of improving
PP efficiency. This observation agrees with the insights from Angeles
and Nath (2007) and Michal et al. (2016). Four interviewees believe
that a relatively short procurement period also embodies high PP effi-
ciency, this is consistent with the views of scholars who focus on the
firms procurement efficiency. Jap (2002) considers that the procure-
ment period could be adopted to measure the process efficiency of e-
reverse auctions (e-RAs) in the context of industrial activities. The
importance of shortening the procurement period is noted in studies by
Janssen and Verbraeck (2008) on e-procurement in the transportation
market and Carter et al. (2004) on e-RAs. The interviewees agreed that
the less labour invested in the PP process, the more efficient the pro-
curement. This notion agrees with the insights from Balaeva and
Yakovlev (2011). However, the labour cost in PP implementation in
China includes the cost of using specialists and procurement officials.
Since the number of procurement officials is relatively fixed in every
public authority, no clear difference can be spotted in different pro-
curement events. Therefore, the interviewees believe that the number
of specialists can better reflect PP efficiency because the number of
specialists changes depending on the characteristics of the procurement
events.
The interviewees believe that the goal of PP is to sign a contract
with a satisfactory supplier. Building on the information collected
through the interviews, in this paper, PP efficiency refers to the
4
Journal of Purchasing and Supply Management 26 (2020) 100622
comparison of gains achieved by public authorities and the input cost
(PP effciency definition).
Gains, which are certain, refer to the signing of the contract between
the public authority and the most satisfying supplier. Input costs, which
are uncertain, include the procurement price cost, time cost and spe-
cialist cost. This paper attempts to measure PP efficiency by considering
three aspects: price efficiency, time efficiency and intellectual effi-
ciency.
Based on the insights gathered during the interviews, we selected
five related factors: centralized procurement, procurement size, the
evaluation method, GPP implementation and the number of bidders.
This study develops hypotheses considering the three aspects of price
efficiency, time efficiency and intellectual efficiency. We also consider
the related factors of the different aspects of efficiency.
3. Hypotheses development
According to the division method of the auction process (Caplice,
2009), the purchasing phase can be divided into two stages, as shown in
Fig. 1. The first stage is the tender stage. In this stage, the main job of
the public authority includes publishing procurement announcements
and procurement documents and randomly selecting specialists. Spe-
cifications concerning whether or not the project will involve adopting
centralized procurement, the procurement size, the evaluation method
and whether or not GPP will be implemented are provided in the pro-
curement documents; therefore, these aspects are considered to be the
related factors that are relevant in this stage. The second stage is the
post-tender, and the main job of the public authority in this stage in-
cludes organizing the bid opening meeting, evaluating bidders and
deciding the winning bidder. The number of bidders is specified in the
bid opening meeting and is considered to be a related factor in this
stage. The order of hypotheses development for every aspect of PP ef-
ficiency in this study is in accordance with the order of these two stages.
3.1. Factors related to price efficiency
This study uses the rate of budget savings to measure price effi-
ciency. The more money that is saved, the higher the price efficiency of
PP (Michal et al., 2016).
Centralized procurement refers to public authorities delegating the
work of the purchasing phase to the centralized procurement agency
(SCNPC, 2002). Bearing the traits of the scaled economy, centralized
procurement has always been regarded as a tool to reduce public ex-
penditures. Therefore, the public authorities of numerous countries,
such as the U.S., the U.K., France, the Republic of Korea, Finland and
Italy, use a certain degree of centralized procurement to save pro-
curement costs. In addition, centralized procurement contributes to
increasing the bargaining power of the public authority; as a result,
lower procurement prices can be secured (Albano and Sparro, 2010). In
China, centralized procurement also involves a higher utilization of
funds. Vagstad (2000) thinks that local public authorities are more
likely to work with their local suppliers under decentralized procure-
ment. Centralized procurement can reduce this prejudice to some de-
gree and leads to more procurement options and the opportunity to sign
contracts with lower prices. Thus, we propose Hypothesis 1.
H1. Centralized procurement is positively associated with the price
efficiency of PP.
GPP refers to the compulsory or preemptive purchase of environ-
mental-friendly products, such as listed in China's environmental la-
belling system, China's energy saving certification system and in public
procurement lists of products with environmental labelling and energy-
saving products (hereafter referred to as green products). GPP also re-
fers to the requirements of certain green credentials of suppliers (Liu
et al., 2019a; Zhu et al., 2013). Despite the fact that GPP is an important
environmental policy tool across the globe (Liu et al., 2019b; Majerník
Q. Wang, et al.
et al., 2017; Parikka-Alhola, 2008), it is not considered to be cost-effi-
cient in the EU countries (Lundberg et al., 2009, 2015). Sorte (2017)
thinks that some enterprises may change their productive processes to
accommodate the procurement needs of public authorities, which may
cause suppliers to increase their investment to meet environmental
standards and can lead to higher bidding prices (Lundberg et al., 2009).
In addition, the price of green products is usually higher than that of
common products (Yadav and Pathak, 2017), which makes it difficult to
cut procurement budgets. Thus, we propose Hypothesis 2.
H2. The implementation of GPP is negatively associated with the price
efficiency of PP.
The evaluation method, formulated by public authorities according
to their preferences, serves as a basis for evaluating suppliers. This
study uses the weight of the bidding price during evaluation as the
evaluation method (Michal et al., 2016). We learned from the partici-
pant interviews that heavily weighting the bidding price in the process
indicates that public authorities prefer to cooperate with suppliers with
lower prices on the premise of meeting procurement demand. Ad-
ditionally, suppliers may lower their bidding prices to win the oppor-
tunity to work with public authorities (Carter et al., 2004). This is in
line with the view of Michal et al. (2016); i.e., the higher the weight of
the bidding price is, the more the procurement budget can be saved for
public authorities. Thus, we propose Hypothesis 3.
H3. The evaluation method (the weight of the bidding price during
evaluation) is positively associated with the price efficiency of PP.
The number of bidders refers to the number of suppliers taking part
in tendering. In general, Chinese PP is in the form of sealed bids, which
means that in the tender stage, all the tender documents are sealed and
bidders cannot know the others’ bidding prices. The bidding prices of
all suppliers and the final number of bidders will not be published until
the post-tender stage. Based on this, this study believes that among the
three types of PP efficiency, the number of bidders is mainly related to
price efficiency. Carter et al. (2004) show that in the auction of sealed
bids, the more bidders, the lower the final price. The view above is
supported by the study on the PP bid-winning price of Pavel and
Sičáková-Beblavá (2013) and Michal et al. (2016). When there is a large
number of bidders, the public authority has more options available for
its choices (European Commission, 2004), and there is a greater like-
lihood that it can cooperate with suppliers with lower price. Based on
the above, we develop the following hypothesis.
H4. The number of bidders is positively associated with the price
efficiency of PP.
Fig. 2 summarizes the hypotheses associated with price efficiency of
PP.
Fig. 2. Research framework of price efficiency.
5
Journal of Purchasing and Supply Management 26 (2020) 100622
3.2. Factors related to time efficiency
This paper uses the procurement period for the measurement of
time efficiency, and a shorter procurement period means higher time
efficiency. The procurement period refers to the time duration from the
date of the procurement announcement publication to the date of bid-
winning. The time period of the tender stage, which is determined by
the public authority when it issues the procurement announcement, is
from the beginning of the tender period to the tender deadline. Since
public authorities prefer to cooperate with responsible suppliers
(Ohashi, 2009), as well as sustainable and high-quality suppliers. They
fully consider the suppliers’ workload of bidding documents when de-
ciding the tender deadline. The post-tender stage is the time period,
which is usually fixed to one day or within one day under normal cir-
cumstances, from organizing the bid opening meeting to deciding the
winning bidder. Therefore, when studying the time efficiency of PP, this
study focus only on the related factors in the tender stage.
In the implementation of centralized procurement projects, a cen-
tralized procurement agency is usually responsible for the procurement
jobs of many public authorities at the same time (Michal et al., 2016).
Therefore, it must consider the characteristics of the projects as well as
its own work intensity before confirming the time of bid opening
meeting, which could be deferred for the sake of proper work intensity
management. This can decrease the time efficiency of procurement.
Thus, we propose Hypothesis 5.
H5. Centralized procurement is negatively associated with the time
efficiency of PP.
The size of procurement refers to the monetary volume (Carter
et al., 2004) of the procurement event. Whether the procurement work
goes smoothly will affect the procurement period, and adding to the
procurement procedures or restarting the tender will prolong the pro-
curement process. Carter et al. (2004) think that the success rate of e-
reverse auction increases with increasing monetary volume. This is
because buying firms place emphasis upon preparation. Since the PP
budget in China comes from the fiscal funds of the government, a sig-
nificant loss (financial funds and manpower) for the public authorities
would be severe if a large size PP transaction fails. In order to reduce
the risk, they will be more fully prepared, and more meticulous and
adequate preparation will extend the procurement period. For example,
public authorities may require the pre-qualification of suppliers, which
is widely applied in Japan (Ohashi, 2009), before the formal tender
when implementing a large procurement project. It is said that sup-
pliers must be pre-qualified in terms of their enterprise credibility,
performance and assets before they are allowed to bid. The addition of
this procedure would prolong the procurement period.
In addition, suppliers who sign contracts with public authorities can
not completely avoid the risk of “hold-up” (Schmitz, 2012). Once it
Q. Wang, et al.
happens, they face larger losses as the size of the procurement in-
creases, which leads some suppliers to be unwilling to participate in PP.
Moreover, small companies may not be able to take part in large PP
transaction because of the greater economic and financial requirements
(Albano and Sparro, 2010). The pre-qualification of suppliers together
with all the conditions mentioned above may lead to a situation where
there are not enough bidders. When the number of bidders is less than
three, the tender should be restarted (SCNPC, 2002), which could
prolong large procurement projects.
Although some suppliers may give up bidding for the reasons above,
large procurement projects can help increase the degree of competition
among participating suppliers (Carter et al., 2004). We learned from the
participant interviews that for suppliers whose main business is serving
public authorities, large orders from a public authority can have a big
influence on the supplier's market share and profit. It can be predicted
that suppliers will face very fierce competition in order to win large-
scale orders. Under the circumstances, interested suppliers will attach
greater importance to the preparation work before bidding, which in-
cludes the evaluation of their own production cost, technical capacity,
productive capacity and even the supply capacity of upstream suppliers.
We also learned from the participant interviews that public authorities
will set aside a relatively long time for bidders to prepare the bidding
documents considering their extremely large workloads. This will also
reduce the time efficiency of procurement. Thus, we propose Hypoth-
esis 6.
H6. The size of procurement is negatively associated with the time
efficiency of PP.
In addition to bidding price, the comprehensive evaluation also
includes non-price factors (Jap, 2002). It is known from the participant
interviews that during the process of preparing the bidding documents,
the bidding price only accounts for a small part of the workload;
however, technical plans, energy conservation and environmental
protection, etc. represent a larger proportion of the work and therefore
it takes a long time to prepare the relevant documents. Heavily
weighting the bidding price automatically means that public authorities
assign less importance to non-price factors; hence, there is no need to
allow a long time for bidders to prepare bidding documents. In contrast,
if the public authority decides to implement GPP, then it will allow the
bidders a relatively long period of time to prepare for the process. For
example, bidders need time to pass the green certification of their
products. And even if the bidder's product has been green certified, it
still needs to apply to add the green product to the green procurement
lists (see appendix in Liu et al., 2019a), which will also take some time.
Green services are more complex, requiring not only the use of green
products, but also a series of green procedure. It takes a lot of time for
bidders to select green products and green services procedures. In
summary, the following hypotheses are developed.
H7. The implementation of GPP is negatively associated with the time
efficiency of PP.
H8. The evaluation method (the weight of the bidding price during
evaluation) is positively associated with the time efficiency of PP.
Fig. 3 summarizes the hypotheses associated with time efficiency of
PP.
3.3. Factors related to intellectual efficiency
This study uses the number of specialists to measure intellectual
efficiency. The fewer specialists involved in the evaluation process, the
higher the PP intellectual efficiency. The selection of specialists must be
conducted in the tender stage. In this light, we pay attention only to the
tender stage when studying intellectual efficiency. For example, se-
lecting specialists is usually earlier than the bid opening day (e.g., 48 h
earlier), there may be multiple suppliers bidding within the two days. In
6
Journal of Purchasing and Supply Management 26 (2020) 100622
this case, even if public authority know the number of some potential
suppliers, it is difficult for them to estimate the final number of bidders.
Therefore, the number of bidders is difficult to be used as a predictive
variable for the number of specialists, which is intellectual efficiency.
We learned from the participant interviews that in order to prevent
clandestine operations (corruption and collusion), the larger size of the
procurement, the more specialists need to be selected to ensure fairness.
Meanwhile, public authorities will decide the number of specialists
according to the workload of the evaluation to complete the evaluation
work on the bid opening day. Large size procurement projects usually
indicate that there is a relatively large evaluation workload, which
drives the public authority to select more specialists. Balaeva and
Yakovlev (2011) believe that the labour intensity of a procedure de-
pends on the complexity of the purchase to a large degree. Specialists
need to review the non-price factors of the bidders in addition to their
bidding prices. A review of this kind is called a “quality review” by
Haruvy and Katok (2013). In auction transactions, the quality review of
suppliers after the auction can last approximately 4–6 weeks (Haruvy
and Katok, 2013), which shows that the work of the review is quite
complex. It is relatively simple to review the list of bid quotes
(Decarolis, 2018), and if the bidding price is heavily weighted, the re-
view work is easy and requires a small number of specialists. In con-
trast, if the evaluation includes factors related to GPP, the review work
will be more complicated and require more specialists. In conclusion,
the following hypotheses are developed.
H9. The size of procurement is negatively associated with the
intellectual efficiency of PP.
H10. The implementation of GPP is negatively associated with the
intellectual efficiency of PP.
H11. The evaluation method (the weight of the bidding price during
evaluation) is positively associated with the intellectual efficiency of
PP.
Fig. 4 summarizes the hypotheses associated with intellectual effi-
ciency of PP.
4. Methodology
4.1. Data collection
Secondary data in this study were collected from one of China
National Center Cities, Chengdu city; its geographical location is shown
in Fig. 5. Collected in April 2019, the data are obtained by content
analysis from actual transaction contracts: procurement documents,
evaluation documents and bid-winning announcements. The detailed
example of data collection process is described in Appendix B.
The hyperlinks of procurement documents and evaluation docu-
ments are published in bid-winning announcements. In this sense, bid-
winning announcements should be collected first. Python (a web
crawler programme) was used to collect the bid-winning announce-
ments of PP in Chengdu city from January 1st, 2018, to June 30th,
2018, on the website “http://www.ccgp-sichuan.gov.cn/” (The pro-
gramme code can be obtained by contacting the corresponding author).
Overall, 994 pieces of data were obtained after removing missing data
and projects of non-open tendering. According to the aforementioned
data requirements, we further cleaned the data:
I. Announcements with incorrect bid-winning prices or procurement
budgets were deleted. Because this study on price efficiency uses the
bid-winning price and procurement budget to calculate the rate of
budget savings, which is the dependent variable. To study time ef-
ficiency and intellectual efficiency, we use the procurement budget
as an independent variable. Documents that do not mention the
budget or the budget is a unit price of the product are excluded.
Overall, 838 pieces of data in this phase can be used in the study of
Q. Wang, et al.
Fig. 3. Research framework of time efficiency.
price efficiency and intellectual efficiency.
II. Announcements with incorrect procurement periods are deleted.
The procurement period is needed as a dependent variable in the
study of time efficiency. However, it is missing in some announce-
ments, and therefore, these samples are excluded. A total of 834
pieces of data can be used in the study of time efficiency.
4.2. Variables definition
According to the requirements of the hypotheses, this section will
develop three different regression models considering the three aspects
of PP efficiency, namely, price efficiency, time efficiency and in-
tellectual efficiency, for hypothesis examination. This study uses or-
dinary least square (OLS) regression for the data analysis.
4.2.1. Dependent variables (DV)
According to the hypotheses, PP efficiency is examined based on
three aspects. The rate of budget saving is a proxy for price efficiency
and is represented by Price. According to Article 6 of the Government
Procurement Law of PRC, public procurement should be carried out
strictly in accordance with the approved budget, so procurement
budget must be greater than or equal to bid-winning price, which
means that the value of Price must be greater than or equal to 0. The
calculation method is shown in Formula 1. The procurement period is a
proxy for time efficiency and is represented by Time. The calculation
method is shown in Formula 2.
Price = (procurement budget - bid-winning price)/procurement budget
(1)
Time = date of bid-winning - date of procurement announcement
publication (2)
The number of specialists is a proxy for intellectual efficiency and is
Fig. 4. Research framework of intellectual efficiency.
7
Journal of Purchasing and Supply Management 26 (2020) 100622
represented by Intellectual. Three of the dependent variables are con-
tinuous variables. The descriptive statistics of the dependent variables
are shown in Table 2.
4.2.2. Independent variables (IV)
This study has seven independent variables, two of which are con-
trol variables. Centralization denotes whether centralized procurement
is adopted in the procurement project. This variable measures whether
the procurement project is entrusted to a centralized procurement
agency listed in the procurement document (public resource trading
centre or procurement centre), and its evaluation is supervised by this
agency. This dummy variable is assigned 1 if a centralized procurement
agency is involved and 0 if not.
Size represents the size of the procurement project. This continuous
variable is measured by the procurement budget listed in the procure-
ment document.
GPP indicates whether the procurement project implemented GPP
or not. This variable is also a dummy variable and is measured by
whether a procurement document demands compulsory or preemptive
procurement of green products or requires suppliers to have a certain
level of green credentials. For this variable, 1 is positive and 0 is ne-
gative.
Evaluation represents the evaluation method of the suppliers. This is
a continuous variable and is measured by the weight of bidding price
stated in the comprehensive evaluation table in the procurement
document.
Number represents the number of bidders. This continuous variable
is measured by the number of suppliers listed in the evaluation docu-
ment.
This paper adopts Type (represents the contract type) and Economy
(represents the economy of the procurement area) as control variables
(CV) (Tas, 2012; Guccio et al., 2014). Type, which is a dummy variable,
indicates whether the subject matter of procurement are goods, where 0
Q. Wang, et al. Journal of Purchasing and Supply Management 26 (2020) 100622

Fig. 5. Geographical location of Chengdu.

Table 2 there are large economic gaps between certain places.

Descriptive statistics of dependent variables.
Dependent Variables/Unit Sample size Mean Std. dev. Min. Max.
4.3. Model development

Price/% 838 6.497 10.513 0 76.725 This paper develops three corresponding OLS regression models
Time/day 834 26.633 5.885 10 72 based on the three aspects to examine the relevant hypotheses. The
Intellectual/person 838 5.279 1.288 1 28
model 1-3 are as follows:

Price = α + β1Centralization + β2 Green + β3 Evaluation + β4 Number

Table 3
Descriptive statistics of independent variables. + β5 Type + β6 Economy + ε (3)

Independent Variables/Unit Sample size Mean Std. dev. Min. Max. Time = α + β1Centralization + β2 ln(Size ) + β3 Green + β4 Evaluatio
Centralization 838 0.155 0.362 0 1 n + β5 Type + β6 ln(Economy ) + ε (4)
Size/million yuan 838 19.100 143.000 0.044 1630
GPP 838 0.541 0.498 0 1 Intellectual = α + β1 ln(Size ) + β2 Green + β3 Evaluation + β4 Type + β5
Evaluation/% 838 22.538 11.288 0 85
Number 838 5.988 7.710 3 101 ln(Economy ) + ε (5)
Type 838 0.474 0.499 0 1
Economy/billion yuan 838 81.168 44.120 13.6 166.580 Formula 3 measures the factors related to price efficiency, Formula
4 measures the factors related to time efficiency, and Formula 5 mea-
sures the factors related to intellectual efficiency. In these formulas, α is
represents goods procurement and 1 represents non-goods procure- the constant term and ε is the residual term.
ment. Economy is a continuous variable and is measured by the 2018 As can be seen from Tables 2 and 3, the units and orders of mag-
GDP of the corresponding area of contract. The detailed data collection nitude of each variable are different. There is a substantial difference
process is described in Appendix B. The descriptive statistics of the between the maximum and minimum values of each variable. In order
independent variables are shown in Table 3. to unify the unit, make the variables more comparable, and at the same
Table 3 shows that the mean for Centralization is 0.155, which de- time to avoid the instability caused by these difference. We use the
monstrates that the majority of the procurement projects are conducted standardized technique for transformation of each variable before the
using a decentralized form. In terms of Size, it can be deduced from the regression calculation. We employ the most commonly used Z-score
minimum and maximum that there is a large difference in the size of the standardization method (Heagerty and Pepe, 1999). The mean value of
different procurement contracts. The mean value of GPP is 0.541, re- the standardized variable is 0 and the standard deviation is 1.
flecting that the majority of procurement projects consider green fac- At the same time, another important issue is that OLS regression has
tors. The study of Liu et al. (2019b) shows that the implementation of the premise of normality of dependent variables. However, the data
GPP in Chengdu occurs mostly in the growth stage, which is in line with obtained by content analysis of public contracts do not strictly comply
the actual situation. For Evaluation, some procurement projects do not with this applicable condition. Therefore, in order to ensure the ro-
take the factor of bidding price into consideration; therefore, its bustness of this study, we use Bootstrap, a non-parametric test. We use
minimum is 0. The minimum for Number is 3, and the maximum is 101, bias-corrected percentile (BC) and bias-corrected and accelerated per-
which shows that the number of suppliers is quite different due to the centile (BCa) bootstrap method as the robustness test of OLS regression
different characteristics of the procurement projects. The mean value in this study. This method does not need to have the premise of nor-
for Type is 0.474, which shows that the volume of procurement of non- mality, and has a good acceptance (Wang et al., 2017). In this study, we
goods and goods is about the same; From Economy, we can see that set 5000 times bootstrap, and set the confidence interval (CI) at 90%

8
Q. Wang, et al. Journal of Purchasing and Supply Management 26 (2020) 100622

Table 4
Pearson correlation analysis of IVs.
Centralization Size GPP Evaluation Number Type Economy

Centralization 1.000
Size -0.013 (0.698) 1.000
GPP -0.003 (0.935) -0.121** (0.000) 1.000
Evaluation 0.001 (0.967) -0.039 (0.254) 0.466*** (0.000) 1.000
Number -0.023 (0.509) -0.017 (0.614) 0.079** (0.022) 0.087** (0.012) 1.000
Type -0.005 (0.887) 0.079** (0.022) -0.430*** (0.000) -0.496*** (0.000) -0.114*** (0.001) 1.000
Economy 0.099*** (0.004) -0.062* (0.071) -0.012 (0.726) -0.079* (0.023) 0.014 (0.687) -0.030 (0.386) 1.000

Notes. the value in the ( ) represents the P-value, *** = P ≤ 0.01, ** = P ≤ 0.05, * = P ≤ 0.1; The variables have been standardized (Z-score) before calculation.

Table 5
Variance inflation factor (VIF) testing.
Model Mean VIF
Model 1 1.226
Model 2 1.227
Model 3 1.270
(Liu et al., 2020).
5. Results
Pearson correlation analysis is conducted on the independent vari-
ables, the results are shown in Table 4. Table 4 reflects that a certain
degree of correlation exists in some of the variables, which may lead to
multicollinearity in the models. Hence, to further ensure the validity of
the models, the paper conducts the variance inflation factor (VIF) test to
examine whether the multicollinearity will seriously influence our
models. The results are shown in Table 5.
It can be seen from Table 5 that the VIF of these models are all less
than 2; therefore, the multicollinearity will not seriously influence our
models, and the regression result is valid, which serves as the basis for
further analysis (Liu et al., 2019b). The OLS regression results and
bootstrap results are shown in Table 6, Table 7 and Table 8.
According to Table 6, the relationship between GPP, Evaluation,
Number and Price is found to be statistically significant (p-value less
than 10% and CI did not cross 0) while the relationship between Cen-
tralization and Price is not (p-value exceeds 10% or CI crossed 0). It
means that the implementation of GPP is negatively associated with the
price efficiency of PP, while the weight of the bidding price during
evaluation and the number of bidders are positively associated with the
price efficiency of PP. H2, H3, H4 are supported.
According to Table 7, the relationship between GPP and Time is
found to be statistically significant while the relationship between
Centralization, Size, Evaluation and Time is not. This result indicate that
the implementation of GPP is negatively associated with the time effi-
ciency of PP. H7 is supported.
According to Table 8, the relationship between Size and Intellectual
is found to be statistically significant while the relationship between
GPP, Evaluation and Intellectual is not. It shows that the size of pro-
curement is negatively associated with the intellectual efficiency of PP.
H9 is supported.
6. Academic and practical contributions
6.1. Discussion
In the tender stage, centralized procurement may not always
achieve higher savings. Although this result contradicts the view of
Albano and Sparro (2010), it agrees with the view of Michal et al.
(2016). Theses results may be due to the lack of information trans-
parency when China implements centralized procurement. The re-
sulting cost increase offsets the cost savings brought about by scale
economy and bargain power (Albano and Sparro, 2010). In order to
mitigate the impact of this problem, the implementation of e-procure-
ment may be a good choice (Arnold et al., 2005). At the same time,
centralized procurement will not cause the extension of procurement
period, proving that although Chinese centralized procurement agency
faces numerous procurement tasks (Michal et al., 2016), their staff have
rich experiences of PP (Sorte, 2017), these individuals are well versed
in estimating the amount of time needed for suppliers to prepare bid-
ding documents. Therefore, the time efficiency will not be influenced. It
also implies that improving the professionalism of procurement staffs is
important to improve the efficiency of PP.
The size of procurement does not significantly extend procurement
period, which may be due to the post-qualification system. Post-quali-
fication, that is, after the bid opening, the bidder's qualification will be
examined by the specialists, and the approved suppliers in this step can

Table 6
Regression result of price efficiency model.
DV: Price Uns.Coef. Std.Err. t p 90% CI 90% CI
BC bootstrap BCa bootstrap

Lower Upper Lower Upper

IV Centralization 0.019 0.033 0.581 0.551 -0.031 0.073 -0.033 0.075

GPP -0.065* 0.039 -1.659 0.097 -0.133 -0.001 -0.135 -0.001
Evaluation 0.156*** 0.041 3.837 0.000 0.085 0.224 0.086 0.223
Number 0.161*** 0.034 4.813 0.000 0.095 0.251 0.099 0.240
CV Type -0.122*** 0.040 -3.047 0.002 -0.184 -0.061 -0.184 -0.060
Economy -0.024 0.034 -0.719 0.368 -0.074 0.027 -0.076 0.029
F for the regression 12.09*** (p < 0.001)
R2 0.080
Adj-R2 0.074
Bootstrap times 5000
Sample size 838

Notes. *** = P ≤ 0.01, ** = P ≤ 0.05, * = P ≤ 0.1; Uns.Coef. = Unstandardized coefficient; Because the Z-score standardization method is used, the
Std.Coef. = Uns.Coef.; CI= Confidence interval.

9
Q. Wang, et al. Journal of Purchasing and Supply Management 26 (2020) 100622

Table 7
Regression result of time efficiency model.
DV: Time Uns.Coef. Std.Err. t p 90% CI 90% CI
BC bootstrap BCa bootstrap

Lower Upper Lower Upper

IV Centralization -0.042 0.035 -1.225 0.221 -0.102 0.024 -0.105 0.028

Size 0.005 0.035 0.155 0.877 -0.020 0.037 -0.019 0.034
GPP 0.069* 0.040 1.699 0.090 0.008 0.126 0.007 0.130
Evaluation 0.030 0.042 0.705 0.481 -0.032 0.094 -0.034 0.095
CV Type -0.051 0.041 -1.240 0.215 -0.115 0.009 -0.114 0.010
Economy -0.028 0.035 -0.805 0.421 -0.087 0.035 -0.087 0.037
F for the regression 2.449** (p = 0.024)
R2 0.017
Adj-R2 0.010
Bootstrap times 5000
Sample size 834

Notes. *** = P ≤ 0.01, ** = P ≤ 0.05, * = P ≤ 0.1.

proceed to the next step of evaluation. Post-qualification can achieve
the same goal as pre-qualification: preliminary screening of qualified
suppliers, but without the need to extend the procurement period. This
convenience makes many Chinese public authorities tend to choose
post-qualification. However, in order to complete the evaluation on the
day of bid opening, more experts are needed, which further supports
H9. In other words, the larger the size of procurement, the more spe-
cialists are needed, not only because of the heavy workload of the
evaluation, but also because of the workload of post-qualification. From
another perspective, larger size of procurement makes public autho-
rities pay more attention, and they may invest more manpower in
preparation, which reduces the time consuming to some extent.
The implementation of GPP is not conducive to saving the pro-
curement budget, which is in line with Lundberg et al. (2009, 2015).
This finding shows that, like developed countries, China's green pro-
ducts also have a premium to a certain degree (Yadav and Pathak,
2017). An alternative explanation is that one of the obstacles to the
implementation of GPP is the higher price of green products (Liu et al.,
2019a). Besides, GPP implementation is also negatively associated with
time efficiency. Public authorities need to allow more time for suppliers
to prepare bidding documents. It suggests that time pressure could also
be one of the barriers to promoting GPP in China (Adela et al., 2014).
In comparison, the implementation of GPP does not lead to an in-
crease in the number of specialists. This finding may be due to the
“green” accounts for a relatively low proportion in the comprehensive
evaluation (approximately 1%-10%, this view is supported in real
contracts), it may not add to the workload of evaluation significantly.
Meanwhile, even if the work of evaluation of GPP is relatively com-
plicated, due to the specialist database in China be divided according to
their specialized areas, public authorities may select specialists who are
familiar with the evaluation of green contracts instead of adding the
number of specialists in GPP implementation.
The higher the weight of the bidding price during evaluation, the
higher the savings. This findings is in line with the study of Pavel and
Sičáková-Beblavá (2013). In the purchasing phase, the pursuit of low
prices in the public authorities is the driving force for suppliers to re-
duce prices (Michal et al., 2016). However, in terms of the whole
process of procurement, there may be some risks. The study of You and
Wang (2007) illustrates that excessive focus on lower bid-winning price
would add to the later risk of compensation claim, therefore, it is not
advisable to pay undue attention to bidding price. In comparison, the
improvement of the weight of the bidding price will not significantly
shorten the procurement period, which supports the thought of Ohashi
(2009). It means that public authorities pay more attention to bidding
price only on the premise that the technical capability and after-sale
service of the supplier meet requirements. Therefore, public authorities
will not cut the preparation time for suppliers to improve time effi-
ciency.
Besides, the number of specialists will not decrease as a result of the
increase in the weight of the bidding price. The reason for this may be
similar to time efficiency. Although public authorities attach im-
portance to bidding prices, they do not neglect the evaluation of other
aspects (Ohashi, 2009). Therefore, the workload of specialists will not
be lowered obviously. In addition, specialists may sometimes have
different evaluations towards one bidder; in this case, decisions should
be made by voting under the principle of the minority obeying the
majority for sake of fairness (SCNPC, 1999). Public authorities will
select enough specialists to make the voting process easier, even though
the workload of evaluation is light.
In post-tender stage, the higher the number of bidders, the more

Table 8
Intellectual-efficiency model regression result.
DV: Intellectual Uns.Coef. Std.Err. t p 90% CI 90% CI
BC bootstrap BCa bootstrap

Lower Upper Lower Upper

IV Size 0.141*** 0.035 4.094 0.000 0.103 0.195 0.096 0.206

GPP 0.009 0.040 0.223 0.824 -0.082 0.084 -0.096 0.088
Evaluation -0.026 0.042 -0.631 0.528 -0.075 0.027 -0.077 0.030
CV Type -0.095** 0.041 -2.313 0.021 -0.167 -0.031 -0.176 -0.029
Economy -0.052 0.034 -1.505 0.133 -0.107 -0.002 -0.107 -0.002
F for the regression 4.916*** (p < 0.001)
2
R 0.029
Adj-R2 0.023
Bootstrap times 5000
Sample size 838

Notes. *** = P ≤ 0.01, ** = P ≤ 0.05, * = P ≤ 0.1.

10
Q. Wang, et al.
procurement budget will be saved, which concur with the insights from
Carter et al. (2004) and agree with Pavel and Sičáková-Beblavá (2013)
and Michal et al. (2016). This finding means that it is the right choice to
encourage open tendering for PP; trying to attract more bidders is of
great importance for saving the budget.
Finally, this study finds that the price efficiency of PP is negatively
associated with the implementation of green public procurement (GPP)
but is positively associated with the evaluation method (the weight of
bidding price during evaluation) and the number of bidders. Time ef-
ficiency is negatively associated with GPP implementation. Intellectual
efficiency is negatively associated with the size of the procurement.
6.2. Academic contribution
The academic contributions of this study are as follows.
First, with China as the research background and actual transaction
contracts as the source of research data, this study adds insights from
China, the largest developing country, to empirical studies of PP effi-
ciency. In addition, this study also specifies the PP procedure in China
and introduces the evaluation system of randomly selecting specialists,
known as a PP system with Chinese characteristics, which provides new
knowledge to the research field of PP.
Second, this study measures PP efficiency considering the three
aspects of price efficiency, time efficiency and intellectual efficiency.
The relationship between them and centralized procurement, procure-
ment size, the evaluation method, GPP implementation and the number
of bidders is studied respectively. The results show that the related
factors of different aspects of efficiency are not the same, which ex-
pands the previous research on PP efficiency.
Finally, adding to Lundberg et al. (2009, 2015), this study suggests
that implementation of GPP in developing country can exert a negative
influence on PP efficiency. This conclusion not only empirically pro-
vides a new related factor for the study of PP efficiency but also serves
as a reference for further study on the barriers of GPP.
6.3. Practical implications: policies
Based on the empirical results, this study suggests that policymakers
can improve PP efficiency from the following perspectives.
First, about centralized/decentralized procurement. This study
found that there is no significant difference between centralized pro-
curement and decentralized procurement in terms of price efficiency.
From this point of view, centralized procurement does not necessarily
lead to the expected benefits derived from economies of scale. We
suggest that policymakers strengthen the supervision of centralized
procurement agencies and improve the performance evaluation stan-
dards related to financial savings. At the same time, this study found
that in terms of time efficiency, there is no significant difference be-
tween centralized procurement and decentralized procurement.
Therefore, in the setting of this study, decentralized procurement does
not seem to compare favorably in terms of time. We suggest that pol-
icymakers should mobilize more initiative and enthusiasm of public
authorities in the procurement process so as to improve the time effi-
ciency of decentralized procurement.
Second, about Green Public Procurement (GPP). Although the
implementation of GPP will have a negative impact on price efficiency,
because of the many benefits of GPP, we still suggest that policymakers
formulate more reasonable GPP implementation policies. Policies and
toolbox with high operability should be formulated to promote GPP. It
is discussed above that a possible reason for the obstacle of GPP im-
plementation in China could be a relatively high price of green product;
therefore, the paper suggests that governments may consider a certain
degree of subsidy and tax deduction and exemption should be given by
governments to enterprises that produce green products to reduce the
cost of green product production (Zhang et al., 2018). Furthermore,
governments should actively organize training themed on GPP (Aragão
11
Journal of Purchasing and Supply Management 26 (2020) 100622
and Jabbour, 2017) to familiarized firm managers, suppliers, and pro-
curement officials with the policies and regulations as well as operation
procedure related to GPP as soon as possible (Liu et al., 2019a) in an
effort to enhance the time efficiency of GPP implementation.
Third, about evaluation method (the weight of the bidding price
during evaluation). In this study, the evaluation method is found to
have a positive impact on price efficiency, but it is not advisable to pay
too much attention to quotation. Comparing the evaluation method
with GPP implementation, policymakers should strike a balance be-
tween “green” and “price”, as well as “quality” and “price”, also known
as value for money (VfM). The specific balance will be a test of the
wisdom of policymakers.
Fourth, about number of bidders. As the number of bids sig-
nificantly affects the price efficiency, increasing the number of bids will
be an important issue in public procurement. A comprehensive in-
formation platform of PP should be built. At present, many public au-
thorities can only publish PP information on local public resource
trading centre or procurement websites of local governments, which
can lead to situations in which PP information is easily neglected by
non-local suppliers. We suggest that a comprehensive PP platform be
built to accommodate all procurement information of public authorities
across China, which could reduce the geographical limitations and re-
spond to the call of Government Procurement Agreement (GPA).
Fifth, about e-procurement. Although this study does not discuss e-
procurement, we believe that e-procurement could be a potential way
for improving public procurement efficiency in the future (Walker and
Brammer, 2012). E-procurement is expected to be promoted as soon as
possible. Despite the fact that e-procurement platforms have been de-
veloped by some public authorities, there is no relevant law or reg-
ulation made for wide promotion of e-procurement. Jap (2002) believes
that e-RAs enable a more efficient buying process. The study of Carter
et al. (2004) reflects that e-reverse auctions can help lower procure-
ment costs and simultaneously reduce procurement periods. The study
of Arnold et al. (2005) finds that it can reduce transaction costs and
costs of the purchasing organization. Swedish practice should be drawn
by local governments to promote and regulate e-procurement by setting
up laws and regulations (Engstrom et al., 2016). In addition, enhancing
the IT skills is also important (Aman and Kasimin, 2011).
7. Limitations and future research
There are also some limitations in this study. First, this study col-
lected data only from Chengdu city; therefore, it can hardly represent
all public authorities in China. Second, due to limitations regarding the
publication of PP information, this study focuses on the purchasing
phase, and the planning phase and contract execution phase are not
included in the study. Therefore, careful consideration should be taken
in applying the evaluation method of PP efficiency to the whole pro-
cedure of PP. Third, the proportion of centralized procurement is
15.5%. It is possible that the skewed proportion of decentralized pro-
jects were the driver of the non-significant result. Fourth, how to
measure the GPP practice is still a problem; as a result, GPP can only be
measured as a dummy variable in our study. We suggest that future
research should develop GPP measurement scales or measurement
system.
Future research can study the efficiency of the entire PP procedure
and thereby introduce new theoretical and practical contributions. This
research has highlighted factors related to PP efficiency; however, their
influence mechanism is still not clear enough. Hence, other factors that
moderate or mediate the relationship between PP efficiency and these
factors deserve further exploration. If PP is divided into different types
to study their efficiency, there may be new discoveries. E-procurement
is gradually growing in China and may become very popular for public
authorities in the future. In this sense, studying the challenges in pro-
moting e-procurement in China and the influence of e-procurement
implementation on PP efficiency is of both theoretical and practical
Q. Wang, et al. Journal of Purchasing and Supply Management 26 (2020) 100622

importance. Additionally, future research can focus on supplier selec- Acknowledgements

tion process in PP, especially examining the topic of sustainability.
CRediT authorship contribution statement
Qi Wang: Writing - original draft, Writing - review & editing,
Investigation. Renjie Zhang: Software, Data curation. Junqi Liu:
Conceptualization, Supervision, Methodology, Writing - original draft,
Writing - review & editing.
Declaration of competing interest
None.
This study is supported by The National Social Science Fund of
China [Grant number: 15XZZ011]; National Natural Science
Foundation of China [Grant number: 71942006] and MOE (Ministry of
Education in China) Project of Humanities and Social Science [Grant
number: 18YJC630218]. The authors thank Prof. Hongying Dai and
Mrs. Xilin Zhang, the public procurement evaluation expert of Sichuan
Provincial People's Government in China [Expert ID: SC0708525;
SC0702246], for their kind help. The authors express their gratitude to
Prof. Wendy Tate, and the AE of JPSM, and two anonymous Reviewers
for the constructive comments and helps on earlier versions of this
paper. The authors also express their gratitude to Dr. Witold Bahr.
Finally, the authors pay the greatest respect to the medical staff and
volunteers who took part in the fight against COVID-19.

Appendix A. Interview protocol (Semi-structured)

The following questions relate to public procurement (PP), the questions are designed to be general in nature and address the issue of improving
procurement efficiency by public authorities.

1. What do you think is the goal of PP?

2. How do you define “PP efficiency”?
3. What characteristics do you think a high efficient PP should have?

Probes: Saving more procurement budget?

Shorter procurement periods?
Less labour input?

4. Do you think it is more representative to use the number of specialists to measure labour input in PP rather than using the number of procurement
officials?
5. What factors are related to the savings of procurement budgets? And why?
6. What factors are related to the procurement period? And why?
7. What factors are related to the number of specialists? And why?
8. Do you think GPP can exert influence on PP efficiency? And why?

Probes: If yes,
What aspects does it affect PP efficiency? (Price, time or number of specialists)
How does it affect?

9. What types of suppliers that public authorities would like to cooperate with?

Probes: Lower price?

Higher quality?
Responsible?
Green and sustainability?
All of above?

10. What are the benefits for suppliers if they cooperate with public authorities?

Probes: More profit?

Increasing market share?

Appendix B. Data collection example

Data collecting process will be introduced with contract documents of the procurement project “Medical Equipment Procurement of First People's
Hospital in Shuangliu District, Chengdu city, Sichuan province” as an example.

Step 1: Logging in the website: “http://www.ccgp-sichuan.gov.cn/” to find the bid-winning announcement page of this procurement project, as is
shown in Fig. 6. Clicking the attachment link marked by “6” and downloading the procurement document and evaluation document, which are
shown respectively in Figs. 7 and 8.
Step 2: As shown in Fig. 6 marked by “4”, the bid-winning price of the project is 1.555 milliion yuan (1555400 yuan), as shown in Fig. 7 marked
by “7”, the procurement budget is 1.568 million yuan (1568000 yuan). According to Formula 1, the rate of budget saving is 0.804%, therefore the
dependent variable Price is 0.804.
Step 3: As shown in Fig. 6 marked by “3”, the publishing date of procurement announcement is 12th December, 2017. Mark “2” shows that the
bid-winning date is 17th January, 2018. According to Formula 2, it can be calculated that the procurement period is 36 days, therefore the

12
Q. Wang, et al. Journal of Purchasing and Supply Management 26 (2020) 100622

dependent variable Time is 36.

Step 4: As shown in Fig. 6 marked by “5”, there are 5 specialists taking part in this project, therefore the dependent variable Intellectual here is 5.
Step 5: As shown in Fig. 6 marked by “1”, this project is not carried out by centralized procurement agency, therefore the independent variable
Centralization is 0.
Step 6: As shown in Fig. 7 marked by “7”, the budget of this project is 1.568 million yuan, therefore the independent variable Size here is 1.568.
Step 7: As shown in Fig. 7 marked by “9”, the weight of energy conservation and environmental protection product is 2%, which indicates the
green product enjoys preemption in this project, therefore the independent variable GPP here is 1.
Step 8: As shown in Fig. 7 marked by “8”, the weight of bidding price in the comprehensive evaluation table is 30%, therefore the independent
variable Evaluation here is 30.
Step 9: As shown in Fig. 8 marked by “10”, there are 3 enterprises listed in the evaluation document, therefore the independent variable Number is
3.

Fig. 6. Screenshot example of bid-winning announcement.

Fig. 7. Screenshot example of procurement document.

13
Q. Wang, et al.
Fig. 8. Screenshot example of evaluation document.
Step 1 - 3 is completed by the web-crawler program, step 4-9 is completed manually by authors of this paper.
References
Adela, J.M., Md, M.I., Chamhuri, S., John, F., 2014. Sustainable procurement in
Malaysian organizations: practices, barriers and opportunities. J. Purch. Supply
Manag. 20 (3), 195–207.
Albano, G.L., Sparro, M., 2010. Flexible strategies for centralized public procurement.
Rev. Econ. Inst. 1 (2), 1–32.
Aman, A., Kasimin, H., 2011. E-procurement implementation: a case of Malaysia gov-
ernment. Transforming Gov. People, Process Policy 5 (4), 330–344.
Amann, M., Roehrich, J.K., Eßig, M., Harland, C., 2014. Driving sustainable supply chain
management in the public sector: the importance of public procurement in the
European Union. Supply Chain Manag.: Int. J. 19 (3), 351–366.
Angeles, R., Nath, R., 2007. Business-to-business e-procurement: success factors and
challenges to implementation. Supply Chain Manag.: Int. J. 12 (2), 104–115.
Aragão, C.G., Jabbour, C.J.C., 2017. Green training for sustainable procurement? Insights
from the Brazilian public sector. Ind. Commerc. Train. 49 (1), 48–54.
Arnold, U., Kärner, H., Schnabel, M., 2005. Target-oriented use of strategic sourcing tools:
a critical analysis creating process awareness for electronic reverse auctions. J. Purch.
Supply Manag. 11 (2–3), 116–128.
Balaeva, O., Yakovlev, A.A., 2011. Estimation of Costs in the Russian Public Procurement
System: a Case Study of Voronezh State University. Social Science Electronic
Publishing. https://ssrn.com/abstract=2660761.
Balsevich, A., Podkolzina, E., 2014. Causes and consequences of low competition in
Russian public procurement. Automatica 38 (6), 917–928.
Bergman, M.A., Lundberg, S., 2013. Tender evaluation and supplier selection methods in
public procurement. J. Purch. Supply Manag. 19 (2), 73–83.
Branzoli, N., Decarolis, F., 2015. Entry and subcontracting in public procurement auc-
tions. Manag. Sci. 61 (12), 2945–2962.
Caplice, C., 2009. Electronic markets for truckload transportation. Prod. Oper. Manag. 16
(4), 423–436.
Caplice, C., Sheffi, Y., 2003. Optimization-based procurement for transportation services.
J. Bus. Logist. 24 (2), 109–128.
Carter, C.R., Kaufmann, L., Beall, S., Carter, P.L., Hendrick, T.E., Petersen, K.J., 2004.
Reverse auctions - grounded theory from the buyer and supplier perspective.
Transport. Res. E Logist. Transport. Rev. 40 (3), 229–254.
Decarolis, F., 2018. Comparing public procurement auctions. Int. Econ. Rev. 59 (2),
391–419.
Engstrom, A., Wallstrom, A., Salehi-Sangari, E., 2016. Implementation of public e-pro-
curement in Swedish government entities. Int. Multiconference Comput. Sci. Inf.
Technol. 315–319.
Erridge, A., Greer, J., 2010. Partnerships and public procurement: building social capital
through supply relations. Publ. Adm. 80 (3), 503–522.
European Commission, 2004. A Report on the Functioning of Public Procurement Markets
in the EU: Benefits from the Application of EU Directives and Challenges for the
Future. . https://ec.europa.eu/docsroom/documents/15446/attachments/1/
translations/en/renditions/pdf.
Guccio, C., Pignataro, G., Rizzo, I., 2014. Evaluating the efficiency of public procurement
contracts for cultural heritage conservation works in Italy. J. Cult. Econ. 38 (1),
43–70.
Hackney, R., Jones, S., Lösch, A., 2007. Towards an e-Government efficiency agenda: the
impact of information and communication behaviour on e-Reverse auctions in public
14
Journal of Purchasing and Supply Management 26 (2020) 100622
sector procurement. Eur. J. Inf. Syst. 16 (2), 178–191.
Haruvy, E., Katok, E., 2013. Increasing revenue by decreasing information in procure-
ment auctions. Prod. Oper. Manag. 22 (1), 19–35.
Heagerty, P.J., Pepe, M.S., 1999. Semiparametric estimation of regression quantiles with
application to standardizing weight for height and age in US children. J. Roy. Stat.
Soc.: C Appl. Stat. 48 (4), 533–551.
Janssen, M., Verbraeck, A., 2008. Comparing the strengths and weaknesses of Internet-
based matching mechanisms for the transport market. Transport. Res. Part E 44 (3),
475–490.
Jap, S.D., 2002. Online reverse auctions: issues, themes, and prospects for the future. J.
Acad. Market. Sci. 30 (4), 506–525.
Jibrin, M.S., Ejura, S.B., Augustine, N.I., 2014. The public procurement reforms in
Nigeria: implementation and compliance challenges. J. Asian Bus. Strat. 4, 149–162.
Knack, S., Biletska, N., Kacker, K., 2017. Deterring kickbacks and encouraging entry in
public procurement markets: evidence from firm surveys in 88 developing countries.
Pol. Res working paper. https://doi.org/10.1596/1813-9450-8078.
Kutlina-Dimitrova, Z., Lakatos, C., 2016. Determinants of direct cross-border public
procurement in EU Member States. Rev. World Econ. 152 (3), 501–528.
Liu, J., Liu, Y., Yang, L., 2020. Uncovering the influence mechanism between top man-
agement support and green procurement: the effect of green training. J. Clean. Prod.
251, 119674.
Liu, J., Shi, B., Xue, J., Wang, Q., 2019a. Improving the green public procurement per-
formance of Chinese local governments: from the perspective of officials' knowledge.
J. Purch. Supply Manag. 25 (3), 100501.
Liu, J., Xue, J., Yang, L., Shi, B., 2019b. Enhancing green public procurement practices in
local governments: Chinese evidence based on a new research framework. J. Clean.
Prod. 211, 842–854.
Loader, K., 2013. Is public procurement a successful small business support policy? A
review of the evidence. Environ. Plann. C Govern. Pol. 31 (1), 39–55.
Lundberg, S., Marklund, P.O., Brännlund, R., 2009. Assessment of green public pro-
curement as a policy tool: cost-efficiency and competition considerations. Umeå
Economic Studies. https://ssrn.com/abstract=1831089.
Lundberg, S., Marklund, P.O., Strömbäck, E., Sundström, D., 2015. Using public pro-
curement to implement environmental policy: an empirical analysis. Environ. Econ.
Pol. Stud. 17 (4), 487–520.
Majerník, M., Daneshjo, N., Chovancová, J., Sančiová, G., 2017. Modelling the process of
green public procurement. TEM J. 6 (2), 272–278.
Mcafee, R.P., Mcmillan, J., 1989. Government procurement and international trade. J.
Int. Econ. 26 (3), 291–308.
Michal, P., Martin, S., František, O., Milan, P., 2016. Impact of selected factors regarding
the efficiency of public procurement (the case of the Czech Republic) with an em-
phasis on decentralization. Ekonomický časopis 64, 22–36.
Mudyarabikwa, O., Regmi, K., 2016. Public-private partnerships and efficiency in public
procurement of primary healthcare infrastructure: a qualitative research in the NHS
UK. J. Publ. Health 24 (2), 91–100.
Ohashi, H., 2009. Effects of transparency in procurement practices on government ex-
penditure: a case study of municipal public works. Rev. Ind. Organ. 34 (3), 267–285.
Panda, P., Sahu, G.P., Gupta, P., 2010. Promoting Transparency and Efficiency in Public
Procurement: E- Procurement Initiatives by Government of India. Social Science
Electronic Publishing. https://ssrn.com/abstract=1880050.
Parikka-Alhola, K., 2008. Promoting environmentally sound furniture by green public
procurement. Ecol. Econ. 68 (1), 472–485.
Q. Wang, et al.
Patrucco, A.S., Luzzini, D., Ronchi, S., 2016. Evaluating the effectiveness of public pro-
curement performance management systems in local governments. Local Govern.
Stud. 42 (5), 1–23.
Pavel, J., Sičáková-Beblavá, E., 2013. Do e-auctions really improve the efficiency of
public procurement? The case of the Slovak municipalities. Prague Econ. Pap. 22 (1),
111–124.
Preuss, L., 2013. Addressing sustainable development through public procurement: the
case of local government. Supply Chain Manag.: Int. J. 14 (3), 213–223.
Ribeiro, C.G., Furtado, A.T., 2015. Public procurement for innovation in developing
countries: the case of Petrobras. Public Procure. Innovat. 263–298 (chapter 10).
Saussier, S., Tirole, J., 2015. Strengthening the efficiency of public procurement. Florenc.
School Regul. Water 22 (3), 1–12.
Schmitz, P.W., 2012. Public goods and the hold-up problem under asymmetric informa-
tion. Econ. Lett. 117 (3), 642–645.
Sorte, J.W.F., 2017. Assessing the efficiency of centralized public procurement in the
Brazilian ICT sector. Int. J. Procure. Manag. 6 (1), 58–75.
Standing Committee of the National People’s Congress (SCNPC), 2002. The Government
Procurement Law of PR China. http://www.people.com.cn/GB/jinji/20020629/
764316.html, Accessed date: 11 March 2018.
SCNPC, 1999. Law of the People's Republic of China on Tenders and Bids. http://npc.
people.com.cn/n1/2018/0105/c14576-29747940.html, Accessed date: 11 March
2018.
Tarantini, M., Loprieno, A.D., Porta, P.L., 2011. A life cycle approach to green public
procurement of building materials and elements: a case study on windows. Energy 36
(5), 2473–2482.
Tas, B.K.O., 2012. Procurement efficiency in public procurement auctions: analysis of
different types of products. Ssrn Electron. J. https://doi.org/10.2139/ssrn.2148638.
Testa, F., Annunziata, E., Iraldo, F., Frey, M., 2016. Drawbacks and opportunities of green
public procurement: an effective tool for sustainable production. J. Clean. Prod. 112,
1893–1900.
Thai, K.V., 2001. Public procurement reexamined. J. Public Procure. 1 (1), 9–50.
Trybus, M., 2006. Improving the efficiency of public procurement systems in the context
of the European Union enlargement process. Publ. Contract Law J. 35 (3), 409–425.
15
Journal of Purchasing and Supply Management 26 (2020) 100622
Uttam, K., Roos, C.L.L., 2015. Competitive dialogue procedure for sustainable public
procurement. J. Clean. Prod. 86, 403–416.
Uyarra, E., Flanagan, K., 2010. Understanding the innovation impacts of public pro-
curement. Eur. Plann. Stud. 18 (1), 123–143.
Vagstad, S., 2000. Centralized vs. decentralized procurement: does dispersed information
call for decentralized decision-making? Int. J. Ind. Organ. 18 (6), 949–963.
Varnäs, A., Balfors, B., Faith-Ell, C., 2009. Environmental consideration in procurement of
construction contracts: current practice, problems and opportunities in green pro-
curement in the Swedish construction industry. J. Clean. Prod. 17 (13), 1214–1222.
Vecchiato, R., Roveda, C., 2014. Foresight for public procurement and regional innova-
tion policy: the case of Lombardy. Res. Pol. 43 (2), 438–450.
Walker, H., Brammer, S., 2012. The relationship between sustainable procurement and e-
procurement in the public sector. Int. J. Prod. Econ. 140, 256–268.
Wang, G., He, Z., Xue, L., Cui, Q., Lv, S., Zhou, P., 2017. Bootstrap analysis of designed
experiments for reliability improvement with a non-constant scale parameter. Reliab.
Eng. Syst. Saf. 160, 114–121.
Witjes, S., Lozano, R., 2016. Towards a more circular economy: proposing a framework
linking sustainable public procurement and sustainable business models”. Resour.
Conserv. Recycl. 112, 37–44.
Yadav, R., Pathak, G.S., 2017. Determinants of consumers' green purchase behavior in a
developing nation: applying and extending the Theory of Planned Behavior. Ecol.
Econ. 134, 114–122.
You, Y., Wang, Q., 2007. The Probe on ‘the Bid Evaluating Method in Accordance with
Risk Appraising for Project that Using Lowest Price Proposal Selected’ Based on
Monte Carlo Simulation:practice and Probe in Xiamen, China”, International
Conference on Construction & Real Estate Management.
Zhang, X., Bai, X., Shang, J., 2018. Is subsidized electric vehicles adoption sustainable:
consumers' perceptions and motivation toward incentive policies, environmental
benefits, and risks. J. Clean. Prod. 192, 71–79.
Zhao, Y., 2016. Comments on the new administrative measures for government pro-
curement evaluation experts. China Gov. PROcure. 16 (12), 40–41 (in Chinese).
Zhu, Q., Geng, Y., Sarkis, J., 2013. Motivating green public procurement in China: an
individual level perspective. J. Environ. Manag. 126 (14), 85–95.