Calveras, Aleix; Ganuza, Juan-Jose; Hauk, Esther - In: Journal of Regulatory Economics 26 (2004) 1, pp. 41-68
This paper analyses the problem of abnormally low tenders in the procurement process. Limited liability causes firms in a bad financial situation to bid more aggressively than financially healthy firms in the procurement auction. Therefore, it is likely that the winning firm is a firm in...