Auctions for public construction with corner-cutting

Arbeitspapier

This paper reports the theoretical and experimental results of auctions for public construction in which firms cut corners. We show that winning bids and qualities of the constructed buildings are both zero in equilibria if there are at least two firms whose initial cash balances are zero. The experimental results support that firms with zeroinitial cash balance win and that the winning bids and the qualities of the constructed buildings are considerably low.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ISER Discussion Paper ; No. 740

Classification and Topics

• Classification: Wirtschaft ; Design of Experiments: Laboratory, Group Behavior ; Auctions ; Information and Product Quality; Standardization and Compatibility
• Subject: Corner-cutting ; Public procurement ; First-price auction ; Experiment

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Akai, Kenju ; Saijo, Tatsuyoshi ; Serizawa, Shigehiro
• Event: Veröffentlichung
• (who): Osaka University, Institute of Social and Economic Research (ISER)
• (where): Osaka
• (when): 2009

Further information

• Handle: http://hdl.handle.net/10419/92875
• Last update: 10.03.2025, 11:43 AM CET