Cost overrun is ubiquitous in public procurement. We argue that this can be the result of a constraint optimal award … a simple design initially enhances competition in the auction. Moreover, the procurer cannot benefit from using a multi …-dimensional auction, as the optimal scoring rule depends only on the price. …

In many auctions, the auctioneer is an agent of the seller. This delegation invites corruption. In this paper we … propose a model of corruption, examine how corruption affects the auction game, how the anticipation of corruption affects … bidding, and how it altogether changes the revenue ranking of typical auctions. In addition we characterize incentive schemes …

We analyse procurement auctions in which sellers are distinguished on the basis of the ratios of quality per unit of … ratio offered is selected as the winner of the auction. We model the decision process as based on a general noisy ranking of …

We consider auction games where, prior to the auction, bidders spend resources to increase their valuations. The market … game is solved by solving an equivalent auxiliary social choice problem. We show that standard auctions are fully efficient …, whereas reserve price requirements entail a double inefficiency. Moreover, we explain how optimal auctions differ from the …

Unlike standard auctions, we show that competitive procurement may optimally limit competition or use inefficient … allocation rules that award the project to a less efficient firm with positive probability. Procurement projects often involve ex … post moral hazard after the competitive process is over. A procurement mechanism must combine an incentive scheme with the …

I study a model of procurement with moral hazard and adverse selection. The procurer is either corrupt or honest and … can choose between sole-sourcing and competitive tender. I compare two procurement regulations: no sole-sourcing is … the gain to corruption is big, a flexible procurement regulation may be better than a rigid procurement regulation. If the …

Until recently, government procurement bidding processes have generally favored domestic firms by awarding the contract …

During the recent sales of UMTS licenses in Europe some countries used auctions while others resorted to so … auction is the better selling mechanism. However, why exactly an auction should be preferred is unclear. Here we present an … argument why beauty contests or negotiations might be dominated by auctions, which is closely linked to the multi …

A set-aside promotes a more equitable procurement process by restricting participation in government tenders to small … firm performance entail trade-offs, which we evaluate empirically using a decade of US federal procurement data. At the …

For the procurement of complex goods the early exchange of information is important to avoid costly renegotiation ex … post. We show that this is achieved by bilateral negotiations but not by auctions. Negotiations strictly outperforms … auctions if sellers are likely to have superior information about possible design improvements, if renegotiation is costly, and …