Bid Protests: The Costs are Real, But the Benefits Outweigh Them

The author analyzes the costs and benefits of bid protests, with a focus on protests filed at the Government Accountability Office (GAO). The author explains that the costs are often overstated, in that GAO’s reporting methodology leads observers to overstate the number of protests and the frequency of successful protests. The author also reports on research regarding what happens after GAO sustains protests, and indicates that firms that successfully protest to GAO generally do not obtain the contract that was the subject of the protest. The article also explains that the “automatic stay” of procurements triggered by a protest to GAO rarely stays in place for the maximum allowable time. The author also addresses the benefits of protests, such as the increase in transparency and accountability that they bring