PUBLIC PROCUREMENT AS A FACTOR IN MARKET PRICE FORMATION

Abstract

The impact of public procurement on market prices is multifaceted and depends on the volume of public demand, the number and structure of participants, the level of competition, supplier concentration, the type of goods or services, regional characteristics, and general market conditions. Competitive procurement can help lower prices as suppliers vie for budget resources, whereas a lack of competition, a limited number of participants, or an insufficiently substantiated estimated cost can create risks of inflated prices. In this regard, it is advisable to evaluate procurement performance not only based on the savings achieved but also by taking into account a broader range of market and competitive characteristics. Public procurement serves not only as a mechanism for meeting the needs of government bodies, budgetary institutions, and territorial communities, but also as a significant instrument through which the state influences the functioning of commodity markets, the level of competition, and the pricing behavior of business entities. Significant volumes of public demand, the regularity of procurement, and the concentration of budgetary resources create the conditions for determining specific price benchmarks in the relevant markets and can influence the balance of supply and demand. An effective public procurement system can perform not only fiscal and supply functions but also foster a competitive market environment and a more economically substantiated price level. The study analyzed the structure of public procurement by major procedure types and determined the specific relationship between their volume and expected value. Based on an analysis of public procurement practices, the development and refinement of the regulatory framework remain crucial for ensuring the efficiency, transparency, and proper organization of procurement during martial law and the post-war recovery of Ukraine. At the same time, ensuring the stable and effective operation of the electronic procurement system is a key task. The results obtained indicate the positive effect of the implemented reforms and confirm the feasibility of further development of the sector on the principles of digitalization, professionalization and transparency