DOI - Mendel University Press

DOI identifiers

DOI: 10.11118/978-80-7701-082-5-0216

The Impact of Market Concentration on the Cost Efficiency of Public Service Contracting and Selection of Service Producer in the Context of Slovak Municipalities

Kristína Murínová ORCID...1
1 Department of Public Economics and Regional Development, Faculty of Economics, Matej Bel University, Tajovského 10, 975 90 Banská Bystrica,Slovakia

Contracting of municipal public services in a historical context was expected to bring cost savings and improvements in service quality. However, recent research questions this assumption and highlights the need to examine factors that may influence the outcomes of contracting–whether in terms of cost efficiency or service quality. The aim of this paper is to explore the impact of market concentration, as one of these factors, on the cost efficiency of contracting and on municipalities' preferences when selecting a producer for the service of municipal waste collection and disposal. Based on primary research carried out among Slovak municipalities, the findings indicate that the market for the selected service is highly concentrated. The relationship between market concentration and contracting price could not be confirmed. When examining changes in municipalities' preferences in relation to market concentration during the selection of a service producer, we observed that most municipalities chose their producers based on the lowest price of their offer, regardless of the market concentration. Since this is one of the few studies addressing this relationship, it contributes to the development of the theory of contracting public services not only in the Slovak Republic but also internationally.

Keywords: Municipal Public Services, Contracting Out, Market Concentration

pages: 216-225



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