The impact of timing on bidding behavior in procurement auctions of contracts with private costs

De Silva, Dakshina G. and Kosmopoulou, Georgia and Pagel, Beatrice and Peeters, Ronald (2010): The impact of timing on bidding behavior in procurement auctions of contracts with private costs.

Abstract

We provide a comparison of bidding behavior between multi-round and single-round auctions considering bid lettings for asphalt construction contracts. Using a reduced-form difference-in-difference approach as well as the nonparametric estimation technique proposed by Racine and Li (2004) we find that, bidding is more aggressive in a sequential multi-round setting than in a simultaneous single-round format. We explore potential causes for the bidding difference across formats related to synergies and level of bidder participation.

• Item Type: MPRA Paper
• Language: English
• Keywords: Multi-unit auctions, Procurement auctions
• Subjects: H - Public Economics > H5 - National Government Expenditures and Related Policies > H57 - Procurement; D - Microeconomics > D4 - Market Structure, Pricing, and Design > D44 - Auctions

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