Cost Overrun and Auction Format in Public Works
AbstractWe study the effect on cost overruns of auction formats (average bid as opposed to �first price rule) conditional on the entry mechanisms (open as opposed to restricted participation). The dataset is a panel of auctions held in the Italian Veneto region between 2004 and 2006. It includes small size public projects (with reserve price up to one million euros) in such sectors as road works and building maintenance. It is commonly believed that cost overruns are lower under average bid auctions relative to fi�rst price auctions. We fi�nd support to this belief only when participation to the auction is restricted.
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Bibliographic InfoPaper provided by University of Verona, Department of Economics in its series Working Papers with number 17/2011.
Date of creation: Nov 2011
Date of revision:
cost overrun; average bid; �first price; free entry; work delays;
Other versions of this item:
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- H57 - Public Economics - - National Government Expenditures and Related Policies - - - Procurement
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-03-28 (All new papers)
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