Research event

Why do for-profit companies compete with non-profit organisations to access development aid contracts?

A presentation by Marieke Huysentruyt (Assistant Professor of Strategy and Business Policy at HEC Paris). A session of the Organization and Management Research Colloquium on Innovation in the Public Sphere.

Prior registration is not required. Refreshments will be served.

How do the bidding strategies of non-profits and for-profits for incomplete government procurement contracts differ? This paper uses archival data on scoring auctions to investigate the impacts of contractual rigidity, discretion and information asymmetries on markets for social goods. For-profits are at a comparative advantage when contracts are rigid, define simple transactions with low ex post information asymmetries; non-profits when contracts allow for high discretion, involve complex transactions with high asymmetries. Cross-sector competition occurs when contracts allow for some discretion, define ‘hybrid’ services with moderate ex post asymmetries. We explain why contracting-out to for-profits involves higher renegotiation costs ex post, and contracting-out to non-profits invokes an accountability vacuum. These results can anchor new theorizing on contract incompleteness and intricate interdependencies between public and private interests.

Marieke Huysentruyt is Assistant Professor of Strategy and Business Policy at HEC Paris, affiliated researcher at SITE, Stockholm School of Economics and academic affiliate at ideas42.  Marieke’s primary research interests concern strategies in markets for social goods, blended value creation, and cost-effective provision of public goods. She combines original data collection and massive digitization efforts with field and lab experiments, and integrates research streams from sociology, psychology, behavioural economics, development and management. She has received several awards including a Fulbright award, the Best Paper Award at the 14th Annual Conference on Social Entrepreneurship in 2017 and Best Poster Award at the 22nd Annual Conference of the Society for Institutional and Organizational Economics in 2018. Her work has been featured in the Economist and been awarded grants from the European Commission, Belgian National Science Foundation (FWO), and the Strategy Research Foundation. Marieke obtained an MSc degree magna cum laude in bioengineering from the Catholic University of Leuven, MSc degree in Applied Economics and Management from Cornell University, and a PhD in Economics from the London School of Economics.