Weight Values, Scoring Rules and Abnormally Low Tenders Criteria in Multidimensional Procurement: Effects on Price

• Jorge González Chapela ^[1]
  1. [1] Centro Universitario de la Defensa de Zaragoza
• Localización: Hacienda Pública Española / Review of Public Economics, ISSN 0210-1173, Nº 228, 2019, págs. 55-81
• Idioma: inglés
• DOI: 10.7866/hpe-rpe.19.1.3
• Enlaces
  • Texto completo (pdf)
• Dialnet Métricas: 1 Cita
• Resumen

  • Many weighing functions are currently in use for evaluating quotes in multidimensional procurement.

    Although these may affect the price paid by the buyer, their design has been little informed by empirical considerations. This paper studies the impacts of weight values, scoring rules, and abnormally low tenders criteria (ALTC) in an original sample of procurements of services. The panel dimension of the data and the rich set of procurement characteristics are exploited to show that convex price scoring rules (PSRs) and increases in the weight for price yield lower prices, whereas independent/interdependent PSRs and different ALTC result in the same price.

• Referencias bibliográficas
  • Albano, G. L., Dimitri, N., Perrigne, I. and Piga, G. (2006), "Fostering participation", in N. Dimitri, G. Piga and G. Spagnolo (eds.),...
  • Albano, G. L., Dini, F. and Zampino, R. (2009), "Bidding for complex projects: Evidence from Italian government's acquisitions of...
  • Asker, J. and Cantillon, E. (2008), "Properties of scoring auctions", RAND Journal of Economics, 39(1): 69-85
  • Asker, J. and Cantillon, E. (2010), "Procurement when price and quality matter", RAND Journal of Economics, 41(1): 1-34
  • Ballesteros-Pérez, P., González-Cruz, MA C. and Cañavate-Grimal, A. (2012), "Mathematical relationships between scoring parameters in...
  • Ballesteros-Pérez, P., Skitmore, M., Pellicer, E. and González-Cruz, M. C. (2015), "Scoring rules and abnormally low bids criteria in...
  • Ballesteros-Pérez, P., Skitmore, M., Pellicer, E. and Zhang, X. (2016), "Scoring rules and competitive behavior in best-value construction...
  • Bergman, M. A. and Lundberg, S. (2013), "Tender evaluation and supplier selection methods in public procurement", Journal of Purchasing...
  • Branco, F. (1997), "The design of multidimensional auctions", RAND Journal of Economics, 28(1): 63-81
  • Cameron, L. J. (2000), "Limiting buyer discretion: Effects on performance and price in long-term contracts", American Economic Review,...
  • Che, Y.-K. (1993), "Design competition through multidimensional auctions", RAND Journal of Economics, 24(4): 668-680
  • Chen, T. H. (2008), "An economic approach to public procurement", Journal of Public Procurement, 8(3): 407-430
  • Dastidar, K. G. (2016), "Scoring auctions with non-quasilinear scoring rules", Available: http://www. fas.nus.edu.sg/ecs/events/seminar/seminar-papers/16-01-12.pdf
  • David, E., Azoulay-Schwartz, R. and Kraus, S. (2006), "Bidding in sealed-bid and English multi-attribute auctions", Decision Support...
  • Decarolis, F. (2014), "Awarding price, contract performance, and bids screening: Evidence from procurement auctions", American Economic...
  • Dimitri, N. (2013), "'Best Value for Money' in procurement", Journal of Public Procurement, 13(2): 149-175
  • Dimitri, N., Piga, G. and Spagnolo, G. (2006), Handbook of Procurement. New York: Cambridge University Press
  • Dini, F., Pacini, R. and Valletti, T. (2006), "Scoring rules", In N. Dimitri, G. Piga, and G. Spagnolo (eds.), Handbook of Procurement,...
  • Domberger, S., Hall, C. and Li, E. A. L. (1995), "The determinants of price and quality in competitively tendered contracts", The...
  • Engel, A. R., Ganuza, J.-J., Hauk, E. and Wambach, A. (2006), "Managing risky bids", in N. Dimitri, G. Piga, and G. Spagnolo (eds.),...
  • Fernández Roca, J. M. (2011), Viabilidad y costes de la externalización de servicios en el ámbito de las Fuerzas Armadas (Doctoral dissertation)....
  • Goldberg, V. P. (1977), "Competitive bidding and the production of precontract information", Bell Journal of Economics, 8(1): 250-261
  • Hanazono, M., Nakabayashi, J. and Tsuruoka, M. (2015), "Procurement auctions with general pricequality evaluation", Available: https://sites.google.com/view/makotohanazono/english-top
  • Hausman, J. A. (1978), "Specification tests in econometrics", Econometrica, 46(6): 1251-1271
  • Iimi, A. (2013), "Multidimensional auctions for public energy efficiency projects", Policy Research Working Paper 6485, The World...
  • Koning, P. and van de Meerendonk, A. (2014), "The impact of scoring weights on price and quality outcomes: An application to the procurement...
  • Lewis, G. and Bajari, P. (2011), "Procurement contracting with time incentives: Theory and evidence", Quarterly Journal of Economics,...
  • Li, T. and Zheng, X. (2009), "Entry and competition effects in first-price auctions: Theory and evidence from procurement auctions",...
  • Lundberg, S. (2006), "Auction formats and award rules in Swedish procurement auctions", Rivista di Politica Economica, 96(1-2): 91-116
  • McAfee, R. P. and McMillan, J. (1987), "Auctions and bidding", Journal of Economic Literature, XXV(June): 699-738
  • Nakabayashi, J. and Hirose, Y. (2016), "Structural estimation of the scoring auction model", RIETI Discussion Paper Series 16-E-008,...
  • Nishimura, T. (2015), "Optimal design of scoring auctions with multidimensional quality", Review of Economic Design, 19(2): 117-143
  • Peckinpaugh, C. J. and Goldstein, J. M. (1992), "Best value source selection-Contracting for value, or unfettered agency discretion?",...
  • Staschus, K., Davidson, J., Gross, G., Logan, D., Perone, S., Shirmohammadi, D. and Vojdani, A. (1991), "A multi-attribute evaluation...
  • Wang, M. and Liu, S. (2014), "Equilibrium bids in practical multi-attribute auctions", Economics Letters, 123(3): 352-355
  • Wooldridge, J. M. (2010), Econometric Analysis of Cross Section and Panel Data, Second edition, Cambridge, MA: The MIT Press