Asymmetries in procurement auctions.

This study investigates bidder behavior in road construction procurement auctions held by the Oklahoma Department of Transportation (ODOT) in the period January 1997 to August 2000. The first essay, "An Empirical Analysis of Entrant and Incumbent Bidding in Road Construction Auctions, " deals with differences in bidding behavior between incumbent and entrant firms in procurement auctions. The study finds that entrants bid more aggressively and win auctions with significantly lower bids than do incumbents. As a result, the forgone surplus is greater for entrants than for incumbents. The differences in bidding patterns are consistent with an asymmetric model of auctions, in which the distribution of an entrant's costs exhibits greater dispersion than that of an incumbent. The characteristics of rival bidders also have an effect on bidding behavior. The tougher the average rival, the lower the bid and the lower the winning bid.The second essay, "Sequential Bidding in Road Construction Auctions, " investigates differences in bidding patterns between morning and afternoon auctions. Empirical evidence from construction contracts suggests that prices are not statistically different between morning and afternoon sessions and that there is no statistically significant difference in the probability of submitting a bid between winners and losers of morning auctions. In afternoon auctions, a large part of the adjustment in bidding behavior is induced by additional asymmetries that arise due to release of information about prices and bids in morning auctions. As expected, the more competitive the set of rivals a firm faces, the more aggressively it bids. Even though the difference in the probability of submitting a bid is not statistically significant between winners and losers of early auctions, losers make a much larger adjustment in their afternoon bids relative to winners.In the third essay, "Synergies in Recurring Procurement Auctions: An Empirical Investigation, " I examine the impact of synergies on bidder behavior in recurring road construction procurement auctions. The projects are spatially correlated. When bidders with potential synergies participate, their probability of bidding and winning increases and they bid more aggressively. Further, firm efficiencies increase the probability of bidding and winning, as does the aggressiveness of bids. Finally, a firm that is capacity unconstrained will bid more aggressively than one that is capacity constrained

Does the Role of Observer Countries in the Regional Trade Agreement matter for Intra-Regional Trade?

This paper investigates the effects of trade by observed economies on the intra-regional trade by SAARC members using PPML gravity models with panel data over the period 2008-2014. Eight SAARC members and eight observed countries, including the EU, are analyzed in capturing the trade effect of observed economies on intra-regional trade in SAARC. This paper provides an empirical measure of observers’ trade, FDI and ODA with SAARC if the exports and imports of observers to/from SAARC have positive or negative signs for intra-regional exports and imports. The results show that the exports and imports of observers to SAARC members have positive effects on bilateral exports among the members. The FDI of observers reduces the bilateral intra imports in SAARC and ODA also has a negative effect on bilateral exports among the members. These results imply that the imports by SAARC members from observer countries increase intra-regional trade in the region. The FDI and ODA increase and decrease intra-regional trade in SAARC, respectively, implying that the policies for both FDI inflow from observers and efficient aid management are needed to increase regional welfare. The study also recommends that trade between SAARC members and its observers help to increase intra-regional trade in SAARC

The impact of regional competition on the health care industry

We investigate factors that determine firm markups by employing data on prices and quantities of various medical procedures at major hospitals in the United States. We focus on the impact of hospital quality, rival competition and the number of medical procedures upon the health care demand. Our analysis covers health-care markets across the United States with the market definition based upon the hospital referral regions. Our findings highlight potential implications of the relationship between hospital markups and market structure

Subcontracting and the survival of plants in the road construction industry:a panel quantile regression analysis

This paper investigates how subcontracting parts of contracted work shapes entrants’ success and survival. We find that newly developed quantile regression approaches can be adapted to study survival of firms competing for government contracts in road construction. The method is applied on a data set that includes patterns of firm entry, exit and auction related information. We find an apparent increase in the business life of firms who subcontract out part of their projects. In Texas, these subcontracting effects appear to be more pronounced for firms with few or no options outside the industry, and among firms who contract out part of their work to Disadvantaged Business Enterprises