Accession Number : AD0615655

Title :   A REVIEW OF AIR FORCE PROCUREMENT, 1962-1964.

Descriptive Note : Memo.,

Corporate Author : RAND CORP SANTA MONICA CALIF

Personal Author(s) : Hall,George R. ; Johnson,Robert E.

Report Date : MAY 1965

Pagination or Media Count : 109

Abstract : Conclusions: The goal of procurement is to obtain the goods and services needed for the Air Force's mission at economically optimal prices. Only 2 per cent of the total obligations studied were explicitly justified on socio-political grounds. Military procurement, differs from many other public policies, such as urban renewal or poverty eradication, where non-economic factors play vital roles. Procurement also differs from many of the regulated industries where the goal is a 'fair' price, with 'fair' having primarily a legal rather than an economic definition. The method used by the Air Force to obtain economically satisfactory procurement results usually is negotiation. Formal advertising is seldom used, and, considering the items purchased by the Air Force, it is hard to see how it could ever be a major method of purchasing. In the negotiation process, design and technical rivalry usually determine which potential supplier will receive the contract. Formal price competition plays only a minor role as a contractor selection criterion. The most important explanation given by contracting officers of the need for negotiating contracts is that prior investment in a program has 'locked-in' the government to a particular supplier.

Descriptors :   (*AIR FORCE PROCUREMENT, HISTORY), COSTS, INDUSTRIES, COMMERCE, MILITARY PROCUREMENT, INDUSTRIAL PROCUREMENT, GOVERNMENT PROCUREMENT, MANAGEMENT PLANNING AND CONTROL

Distribution Statement : APPROVED FOR PUBLIC RELEASE