I am a public procurement expert with almost 20 years of research and hands-on experience in a variety of regulatory environments . I am also a part-time University Lecturer on industrial organization and market design. am committed to ensuring 'thinking and doing' in procurement coexist under one roof, with my research and civil service practice constantly informing each other

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Gian Luigi Albano

Emails: gla@gianluigialbano.com   |  galbano@luiss.it  |  gianluigi.albano@consip.it

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On governments, markets and the desperate quest for the answer to what happened to Alice after she stepped through the looking-glass...


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(Some of) The Lessons of Paul Milgrom and “Bob” Wilson to avoid “Bad Buying” and … “Worse Thinking” – Part 1

(Some of) The Lessons of Paul Milgrom and “Bob” Wilson to avoid “Bad Buying” and … “Worse Thinking

2020-10-14 11:56

The 2020 Nobel Laureates for Economics, Paul Milgrom and Robert (“Bob”) Wilson “have studied how auctions work. They have also used their insights to

Data management and Information in public procurement 4.0

Data management and Information in public procurement 4.0

2018-09-25 15:54

The following text is (almost) the transcript of the keynote speech I delivered at the 2018 Global Public Procurement Conference organised by the Interamerican

Books&Ideas:

Books&Ideas: "Atomic Habits" and Kaizen

2024-07-14 12:58

I bumped into “Atomic Habits” half by accident and half some sort of mental correlation with another recently finished book “The Subtle Art of Not Giv

Gas in - Electricity out

2022-12-15 18:41

Gas, electricity and economic fragility

The Alluring Legacy of William Vickrey to Public Procurement (Practitioners)

The Alluring Legacy of William Vickrey to Public Procurement (Practitioners)

2021-01-03 15:13

In 1996, the Nobel Prize for Economic Sciences was awarded jointly to James A. Mirrlees and William Vickrey “for their fundamental contributions to th

“Will the next global emergency require

“Will the next global emergency require "virtual" central purchasing bodies?”

2020-07-05 18:54

Psychologists as well as sociologists will pour much ink – whether virtual or liquid – about the impact of social distancing on learning, soft skills

Much noise and a few signals: Will Alice ever learn anything about centralized procurement?

Much noise and a few signals: Will Alice ever learn anything about centralized procurement?

2020-05-30 22:10

Occasionally, the discussion about the pros and the cons of policy makers’ inclination to create new or to further expand the role of already-establis

Gli appalti pubblici tra la Scilla della flessibilità e la Cariddi dell'ipertrofia regolamentare

Gli appalti pubblici tra la Scilla della flessibilità e la Cariddi dell'ipertrofia regolamentare

2018-06-02 16:16

Chiunque abbia maturato un minimo di esperienza negli appalti pubblici in Italia è ben consapevole di quanto le "regole del gioco" siano frutto di un

Start-up post 26 May 2018 (EN)

Start-up post 26 May 2018 (EN)

2018-05-25 22:26

I have been incessantly using the metaphor of Sisyphus in my training sessions on the economic analysis of procurement, and particularly of public pro

(Some of) The Lessons of Paul Milgrom and “Bob” Wilson to avoid “Bad Buying” and … “Worse Thinking

2020-10-14 11:56

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(Some of) The Lessons of Paul Milgrom and “Bob” Wilson to avoid “Bad Buying” and … “Worse Thinking” – Part 1

The 2020 Nobel Laureates for Economics, Paul Milgrom and Robert (“Bob”) Wilson “have studied how auctions work. They have also used their insights to

The 2020 Nobel Laureates for Economics, Paul Milgrom and Robert (“Bob”) Wilson “have studied how auctions work. They have also used their insights to design new auction formats for goods and services that are difficult to sell in a traditional way, such as radio frequencies. Their discoveries have benefitted sellers, buyers and taxpayers around the world.” (nobelprize.org)

 

The layperson might have got only an imprecise clue of the relevance of the auction machinery for the 3G spectrum auctions frenzy during the 1995-2005 decade. Tens of billions of euro flooded into governments’ pockets in the US and in Europe. Mind you, not all auctions met the initial optimistic expectations. The reason is simple. There is no one-size-fit-all solution! (copyright by Paul Klemperer, Oxford University) In other words, design matters. Design depends upon many factors: the nature of object (a slice of the radio spectrum would seem fairly different from a bus route), the characteristics of relevant market, the presence of incumbent(s) etc..

 

Believe it or not, this lesson can (in fact, should!) be safely applied to procurement design, be it private or public. One of Peter Smith’s main messages in his lively “Bad Buying” is that “the devil is in the details” (okay, not sure he has actually written this sentence…). In a reader-friendly and entertaining style, he (sort of) intuitively makes use of the main achievements of the last 40 years of auction (and contract) theory into a critical analysis of some (of the) rough(est) mistakes in procurement design (and implementation).

 

Let me mention one simple example borrowed from my own experience in public procurement. The primary role that policy makers around the world give to small and medium enterprises (SME’s) keeps inducing some procurement “experts”, including well established academics, to preach ex cathedra that centralised solutions such as framework agreements and the devilish (again him! or her?) organizations implementing centralized procurement solutions, that is, Central Purchasing Bodies, are the icons of all evils, inflicting (economic) pains to SMEs as well as triggering the most dreadful anticompetitive outcomes. Well, I am not nourishing the illusion that such “experts” invest much of their research time trying to decipher Milgrom’s and Robert’s seminal papers. They are not definitively accessible to everybody, a hell (again!) of math is needed. However, the Nobel laureates’ experience as global consultants in auction design has convinced them to write policy papers in plain, accessible English language to warn to-become auction practitioners: Design matters! Solutions are neither “bad” or “good” per se. (please don’t forget, though, to have a look at Prof. Paul Klemperer’s –University of Oxford- and Prof. Ken Binmore’s -University College London- nontechnical writings on auction design as well).

 

Deep and hard thinking is needed, coupled with the humility of adapting solutions adapt to evolving circumstances.  

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