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

By Dakshina G. De Silva, Georgia Kosmopoulou, Beatrice Pagel and Ronald Peeters

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.

Topics: H57 - Procurement, D44 - Auctions
Year: 2010
DOI identifier: 10.2139/ssrn.1722842
OAI identifier: oai:mpra.ub.uni-muenchen.de:27355

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