The Biden Administration Competition Policy Executive Order: A Whole of Government Program for Public Procurement in the United States

This paper examines the implications of the Biden Administration Executive Order (EO) of July 2021 for public procurement in the United States. The Biden EO emphasizes that the realization of the benefits of competition requires more than the application of antitrust laws. The EO proposes a “Whole of Government” strategy that engages a broad collection of public agencies whose mandates encompass a wide range of policy domains. The Whole of Government approach reflects an awareness that decisions taken by public agencies well beyond the federal antitrust enforcement agencies (the Department of Justice and the Federal Trade Commission) shape the enabling environment in which business rivalry flourishes and the gains from competition fully emerge. The paper studies the EO’s potential implications for public procurement in three parts. It begins by identifying the EO’s central themes and its provisions that deal directly with public procurement. Among other features, the EO exhorts government departments to use the policy tools at their disposal to promote competition, and it urges agencies to work collectively to devise procompetition strategies. For example, among other agencies, the EO singles out the US Department of Defense as an institution that should consider how adjustments to its rules and practices might expand competitive purchasing options. The second part of the paper provides a taxonomy of public policies that determine the intensity of competition in public procurement markets. Prominent among these are public procurement statutes, regulations, and processes that determine eligibility to participate in public tendering and negotiated contract awards; decisions by procurement authorities to use expenditures to promote entry and expansion by new firms in market niches controlled by long-term legacy suppliers; antitrust, procurement, and anti-corruption measures that seek to detect and deter bid-rigging on public tenders; trade policies that limit entry by foreign suppliers into public procurement markets. These and other government policies play decisive roles in shaping competition in public procurement. The third section of the paper sets out specific steps that government officials can take to realize a Whole of Government competition policy for government procurement. These include the expansion of efforts already underway to increase collaboration between antitrust, anticorruption, and public procurement authorities to detect illegal supplier collusion and to adjust procurement rules to expand the range of choices available to government purchasers; the replication of past success in using public procurement expenditures to promote new entry into public procurement markets; and the adjustment of trade policies that restrict foreign entry into the United States. In addressing this topic, the authors build upon previous work that has underscored the importance of a multidisciplinary approach to solving competition problems frequently observed in a variety of economic markets, including public procurement.