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Snow Removal Auctions in Montreal : Costs, Informational Rents, and Procurement Management

Author

Listed:
  • V. Flambard

    (UMR CNRS 8179 - Université de Lille, Sciences et Technologies - CNRS - Centre National de la Recherche Scientifique)

  • P. Lasserre
  • P. Mohnen

Abstract

Using nonparametric estimation techniques adapted from Guerre et al. [2000], we infer cost distributions and informational rents, from 666 snow removal contracts offered for tender by the City of Montreal. Our results are compatible with standard received theory of competitive auctions: there is a positive correlation between costs and bids; rents increase with the variance of costs and decrease with the number of bidders. Bids and costs have decreased over the sample period, while informational rents remained stable. The City deserves credit for these results, as it has succeeded in exploiting economies of scale while maintaining competition.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • V. Flambard & P. Lasserre & P. Mohnen, 2007. "Snow Removal Auctions in Montreal : Costs, Informational Rents, and Procurement Management," Post-Print hal-00186418, HAL.
    • Handle: RePEc:hal:journl:hal-00186418
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    References listed on IDEAS

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    1. Emmanuel Guerre & Isabelle Perrigne & Quang Vuong, 2000. "Optimal Nonparametric Estimation of First-Price Auctions," Econometrica, Econometric Society, vol. 68(3), pages 525-574, May.
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    9. Véronique Flambard & Isabelle Perrigne, 2006. "Asymmetry in Procurement Auctions: Evidence from Snow Removal Contracts," Economic Journal, Royal Economic Society, vol. 116(514), pages 1014-1036, October.
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    14. Hardle, Wolfgang & Tsybakov, A. B., 1993. "How sensitive are average derivatives?," Journal of Econometrics, Elsevier, vol. 58(1-2), pages 31-48, July.
    15. Donald, Stephen G & Paarsch, Harry J, 1993. "Piecewise Pseudo-maximum Likelihood Estimation in Empirical Models of Auctions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 34(1), pages 121-148, February.
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    Cited by:

    1. Sundström, David, 2016. "The Competition Effect in a Public Procurement Model: An error-in-variables approach," Umeå Economic Studies 920, Umeå University, Department of Economics, revised 17 Jun 2016.
    2. Atsushi Iimi, 2016. "Multidimensional Auctions for Public Energy Efficiency Projects: Evidence from Japanese Esco Market," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 49(3), pages 491-514, November.
    3. Antonio Estache & Atsushi Iimi, 2012. "Quality or Price? Evidence from ODA-Financed Public Procurement," Public Finance Review, , vol. 40(4), pages 435-469, July.

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    More about this item

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • H40 - Public Economics - - Publicly Provided Goods - - - General

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