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Challenges of Electronic Reverse Auctions in Construction Industry—A Review

Author

Listed:
  • Tomáš Hanák

    (Faculty of Civil Engineering, Brno University of Technology, 602 00 Brno, Czech Republic)

  • Ivan Marović

    (Faculty of Civil Engineering, University of Rijeka, HR-51000 Rijeka, Croatia)

  • Nikša Jajac

    (Faculty of Civil Engineering, Architecture and Geodesy, University of Split, HR-21000 Split, Croatia)

Abstract

The innovation of construction procurement by means of electronic reverse auctions is a controversial subject of discussion among both researchers and practitioners. This paper consolidates and critically discusses current knowledge concerning the adoption and use of electronic reverse auctions in the light of specific features of the construction industry. A systematic literature review has been employed to select papers indexed in Scopus and Web of Science databases. The findings of the study indicate that studies are addressing especially five main areas, i.e., suitability of electronic reverse auction (eRA) for construction tenders, related drivers and barriers, ethical considerations, savings potential and bidding behavior, and bid distribution. Accordingly, the authors are suggesting three directions in which future research should focus on mutual interaction of electronic reverse auctions and long-term effects on construction project outcomes.

Suggested Citation

  • Tomáš Hanák & Ivan Marović & Nikša Jajac, 2020. "Challenges of Electronic Reverse Auctions in Construction Industry—A Review," Economies, MDPI, vol. 8(1), pages 1-14, February.
    • Handle: RePEc:gam:jecomi:v:8:y:2020:i:1:p:13-:d:320816
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    References listed on IDEAS

    as
    1. Mojmír Prídavok & Radoslav Delina, 2013. "Effective Spend Management Through Electronic Reverse Auction Configurations," Quality Innovation Prosperity, Technical University of Košice, Department of integrated management, vol. 17(1).
    2. Koki Arai & Emi Morimoto, 2019. "The Construction Industry and (Dis)Economies of Scope: Empirical Research in the Hokkaido Procurement Auction," Journal of Industry, Competition and Trade, Springer, vol. 19(2), pages 281-292, June.
    3. Cheng, Chi-Bin, 2011. "Reverse auction with buyer-supplier negotiation using bi-level distributed programming," European Journal of Operational Research, Elsevier, vol. 211(3), pages 601-611, June.
    4. Skitmore, Martin, 2002. "Identifying non-competitive bids in construction contract auctions," Omega, Elsevier, vol. 30(6), pages 443-449, December.
    5. Pablo Ballesteros-Pérez & Martin Skitmore, 2017. "On the distribution of bids for construction contract auctions," Construction Management and Economics, Taylor & Francis Journals, vol. 35(3), pages 106-121, March.
    6. Sheng Li & Peter Philips, 2012. "Construction Procurement Auctions: Do Entrant Bidders Employ More Aggressive Strategies than Incumbent Bidders?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 40(3), pages 191-205, May.
    7. Mohamed Charki & Emmanuel Josserand & Nabila Charki, 2011. "Toward an Ethical Understanding of the Controversial Technology of Online Reverse Auctions," Journal of Business Ethics, Springer, vol. 98(1), pages 17-37, January.
    8. Prashant V. Pawar & Abhishek Behl & Padmanabha Aital, 2017. "Systematic literature review on electronic reverse auction: issues and research discussion," International Journal of Procurement Management, Inderscience Enterprises Ltd, vol. 10(3), pages 290-310.
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