Friday, November 22, 2019
On the Competitive Effects of Screening in Procurement
By: | Seres, G. (Tilburg University, TILEC); Pigon, Adam |
Abstract: | Procuring authorities frequently use screening in order to mitigate risky bids. This study estimates the effect of bid screening and litigation on entry and bidding using a unique data set on highway construction procurement auctions in Poland. The market exhibits a screening method that ex post selects eligible offers. We demonstrate with an empirical model that this method disproportionately affects small firms and creates a barrier to entry. Our results suggest that screening increases bids by two channels. First, it directly inflates bids as well as decreasing entry. Second, in a competitive market, lower entry also inflates bids and prices. |
URL: | http://d.repec.org/n?u=RePEc:tiu:tiutil:78e45bf6-3a0a-46a0-9abd-78a8baa4e3ad&r=com |
https://lawprofessors.typepad.com/antitrustprof_blog/2019/11/on-the-competitive-effects-of-screening-in-procurement.html