Evaluation of Bidding Groups in First-Price Auctions

Projekt Start:12/2016
Forscher:Klaus Gugler, Michael Weichselbaumer, Christine Zulehner
Kategorie: Financial Markets
Finanziert von:LOEWE

In this paper, we analyse bidding groups that participate in procurement auctions. Our main question is to ask, whether in the absence of the joint bid, there could have been two or more independent bids. We utilize data from the Austrian construction sector and estimate models of first-price sealed-bid auctions with endogenous entry. Based on estimated bidding distributions and bidders' entry behavior, we run counterfactual simulations and aim to disentangle the market power effect from potential cost efficiencies.