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Greve, T. (2023). Auctions with In-house Bids. Portuguese Economic Meeting.
T. Greve, "Auctions with In-house Bids", in Portuguese Economic Meeting, Braga, 2023
@misc{greve2023_1732482504987, author = "Greve, T.", title = "Auctions with In-house Bids", year = "2023", url = "https://pej2023.com/" }
TY - CPAPER TI - Auctions with In-house Bids T2 - Portuguese Economic Meeting AU - Greve, T. PY - 2023 CY - Braga UR - https://pej2023.com/ AB - The US government was front-runner in the employment of in-house bidding in public procurement tenders, known as A-76 competitions. In 2009, this type of competitions was prohibited due to a number of concerns, including uncertainty with regard to cost savings. We study a tender where an in-house unit competes with external private bidders. In equilibrium, the in-house bidder bids its true competitive cost, generating cost savings for the government (/buyer). Under a scenario of information revelation regarding the competing bids to the in-house bidder, the equilibrium strategy of the in-house bidder remains unchanged, and so this information does not translate into an advantage for the in-house bidder, or the buyer. Under a collusion scenario, the in-house bid serves as an upper bound to the collusive bid, lowering its value (reaching a bounded collusion effect). ER -