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Socioeconomic Policies In Public Procurement: What Should We be Asking of Public Procurement Systems?

The Biden Administration, in its first few days in office, clearly stated its intention of using the public procurement system as a means to achieve goals such as favoring domestic companies and workers, ensuring a sustainable public health supply chain, protecting the federal workforce, advancing racial equity, and replacing the federal government’s fleet of vehicles with electric vehicles. The use of public procurement systems in this manner is not new. In fact, it has become commonplace for incoming administrations at different levels of government both in the United States and abroad to announce broad policy objectives when entering office. While there is wide consensus that it is possible to leverage procurement systems to achieve societal goals beyond the purchase of the good or service itself, the reliance on the system to provide such far-ranging solutions coupled with the mixed evidence on the effectiveness of some policies raises concerns over whether the procurement system is able to achieve its primary goal of efficiency in procurement while simultaneously meeting societal goals. In this Article, we advocate for increased rigor in the assessment of costs and benefits derived from the application of socioeconomic policies in public procurement, and for changes in the governance structure that would place the burden of justifying use of the procurement system on the agencies in charge of the specific policy. In this scenario, the procurement officer would remain the ultimate decision-maker regarding a specific procurement, but now equipped with better information would be able to make better decisions. To this end, we provide a taxonomy of socioeconomic procurement policies that are used in the United States and in other countries and review evidence of the effectiveness of different mechanisms used. We develop and provide a conceptual framework on how to review socioeconomic policies coherently while respecting the efficiency goal of the procurement system.