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Detecting Collusion through Exchange of Favors in Repeated Procurement Auctions

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Author Info
Rieko Ishii () (Institute of Social and Economic Research, Osaka University)
Abstract

It is known that bid rigging in public-work auctions in Japan often takes the form of exchanging favors. In such a scheme, the winner is designated based on the amount of favor he has given to other members of the ring. By explicitly modeling gfavorh as an explanatory variable, this paper analyzes data from the public-works auctions for consulting works in Naha, Japan, to confirm that such a collusion scheme is in operation.

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File URL: http://www2.econ.osaka-u.ac.jp/library/global/dp/0715.pdf
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Publisher Info
Paper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 07-15.

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Length: 25 pages
Date of creation: May 2007
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Handle: RePEc:osk:wpaper:0715

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Web page: http://www.econ.osaka-u.ac.jp/
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Related research
Keywords: Bid rigging repeated auction.

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Find related papers by JEL classification:
D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
H57 - Public Economics - - National Government Expenditures and Related Policies - - - Procurement
L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Pesendorfer, Martin, 2000. "A Study of Collusion in First-Price Auctions," Review of Economic Studies, Blackwell Publishing, vol. 67(3), pages 381-411, July.
  2. McAfee, R Preston & McMillan, John, 1992. "Bidding Rings," American Economic Review, American Economic Association, vol. 82(3), pages 579-99, June. [Downloadable!] (restricted)
    Other versions:
    • McAfee, R. Preston & McMillan, John., 1990. "Bidding Rings," Working Papers 726, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
  3. Skrzypacz, Andrzej & Hopenhayn, Hugo, 2004. "Tacit collusion in repeated auctions," Journal of Economic Theory, Elsevier, vol. 114(1), pages 153-169, January. [Downloadable!] (restricted)
    Other versions:
  4. Mark Duggan & Steven D. Levitt, 2000. "Winning Isn't Everything: Corruption in Sumo Wrestling," NBER Working Papers 7798, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
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