ABSTRACT
The modern states across the world are obliged to provide a range of services to the public in the form of general infrastructure, health care, education, housing, transport, energy, defence, social security, policing. 1 Traditionally, the state either in its own capacity or through delegated monopolies and publicly controlled enterprises has engaged in market activities in order to serve public interest. 2
The concept of the state encapsulates an entrepreneurial dimension to the extent that it deploys wealth as policy instrument ( dominium ). 3 However, although entering into transactions with a view to providing goods, services and works to the public, this type of action by the state does not resemble the commercial characteristics of entrepreneurship, inasmuch as the aim of the state’s activities is not the maximisation of profits 4 but the observance of public interest. 5
Such participation by the state in the relevant market takes place on behalf of the public and the society as a whole 6 , and the whole process has been described as corporatism. 7 In fact, corporatism has been seen as a market phenomenon which has created a specific forum for the supply and demand sides. This forum is known as public markets. 8 Public markets, in contrast to private ones, are the forum where public interest 9 substitutes profit maximisation. 10 Corporatism has also revealed the dimension of the state as a service provider to the public and that notion has always been linked with the procurement and subsequent state-ownership of the relevant assets. As a process of public sector management, corporatism has primarily been delivered through competitive tendering in order to satisfy the needs for accountability and transparency. Alongside the above objectives, competitive tendering has also represented a procedural delivery system for corporatism which has aimed, at least in principle, at introducing a balanced equilibrium in the supply/demand public procurement equation. 11 Thus, the public and private sectors transact through an institutionalised structure which aims at replicating a regime of competition similar to that which exists in private markets. 12 Private markets are generally structured as a result of competitive pressures originating in the buyer/supplier interaction and their configuration can vary from monopoly/oligopoly to perfect
competition, whereas public markets reveal a different picture, their structure being based upon a monopsony/oligopsony character.
