Substantive and instrumental rationality in public bidding: gains and losses in the selection of the most advantageous bid

Abstract

This article aims to identify elements present in the bidding processes of public administration related to instrumental and/or substantive rationality. The results show that the tensions between these two approaches contribute to the critical evaluation of the public manager’s decisions on defining the licensing and technical qualification criteria required by the bidding companies. Although the event should promote price competition and provide the best contract, the excess of instrumental rationality in the discretionary and linked acts result in substantial deficiencies for the functioning of the public administration, which goes against the public interest. The study’s theoretical foundation is based on the literature about rationality in the organizations and the tensions between the instrumental and substantive rationality. This is a qualitative research, performed through document analysis, bibliographical research, and non-participant observation. Public bidding sessions of a town in the Northwest of the state of Rio Grande do Sul with a population of about 60,000 inhabitants were observed between 2017 and 2019. The research showed that the government’s bidding processes are overly guided by instrumental rationality. This characteristic promotes disputes focused on bidders’ private interests at the expense of the public interest, which may trigger a series of problems to the public administration.

Keywords:
Instrumental and substantive rationality; Public administration; Biddings; Better contract