STRATEGIC BIDDING AND CONTRACT RENEGOTIATION

• 成果类型: Article
• 署名作者: Jung, Hojin; Kosmopoulou, Georgia; Lamarche, Carlos; Sicotte, Richard
• 署名单位: Jeonbuk National University; University of Oklahoma System; University of Oklahoma - Norman; University of Kentucky; University of Vermont
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12368
• 发表日期: 2019
• 页码: 801-820
• 关键词: price adjustment policies; COMPETITION; BEHAVIOR

摘要

When firms bid in procurement auctions, they take into account the likelihood of future contract renegotiations. If they anticipate that certain input quantities will change ex post, they have an incentive to strategically skew their itemized bids, thereby increasing profits for themselves and costs for the procuring agency. We develop and estimate a structural model of strategic bidding using a data set of road construction projects in Vermont. We find that bidding strategies lead to increased markups for renegotiated items and reduced markups for nonrenegotiated items, results consistent with bid-skewing.