Heterogeneity-promoting optimal procurement
When procurement takes place in the presence of horizontally differentiated contractors, the design of the object being procured affects the resulting degree of competition. This paper highlights the interaction between the optimal procurement mechanism and the design choice. Contrary to conventional wisdom, the sponsor's design choice, instead of homogenizing the market to generate competition, promotes heterogeneity.
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References listed on IDEAS
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- Yeon-Koo Che, 1993.
"Design Competition through Multidimensional Auctions,"
RAND Journal of Economics,
The RAND Corporation, vol. 24(4), pages 668-680, Winter.
- Che, Y.K., 1991. "Design Competition through Multidimensional Auctions," Working papers 9123, Wisconsin Madison - Social Systems.
- Brennan, Timothy J, 1996. "Making Economic Sense of the Telecommunications Act of 1996," Industrial and Corporate Change, Oxford University Press, vol. 5(4), pages 941-61.
- Juan J. Ganuza & Lambros Pechlivanos, 1998.
"Heterogeneity-promoting optimal procurement,"
Economics Working Papers
377, Department of Economics and Business, Universitat Pompeu Fabra, revised Jan 1999.
- McAfee, R. Preston & McMillan, John, 1989. "Government procurement and international trade," Journal of International Economics, Elsevier, vol. 26(3-4), pages 291-308, May.
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