Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement
Infrastructure projects are often technically complicated and highly customized. Therefore, procurement competition tends to be limited. Competition is the single most important factor toward auction efficiency and anti-corruption. However, the deg...
| Main Authors: | , |
|---|---|
| Format: | Policy Research Working Paper |
| Language: | English |
| Published: |
2012
|
| Subjects: | |
| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090304110004 http://hdl.handle.net/10986/4049 |
| id |
okr-10986-4049 |
|---|---|
| recordtype |
oai_dc |
| spelling |
okr-10986-40492021-04-23T14:02:14Z Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement Estache, Antonio Iimi, Atsushi ADMINISTRATIVE COSTS AFFILIATED ORGANIZATIONS ANTI-CORRUPTION AUCTION AUCTION PROCESS AUCTIONS BID EVALUATION BID EVALUATION PROCESS BID PRICE BIDDER BIDDERS BIDS CAPABILITIES CIVIL WORKS COLLUSION COMMUNICATION TECHNOLOGY COMPARATIVE ADVANTAGE COMPETITION POLICY COMPETITIVE BIDDING CONSTRUCTION WORKS CONTRACTOR CONTRACTORS COST ESTIMATE COST ESTIMATES COVARIANCE MATRICES DEVELOPMENT ASSISTANCE DEVELOPMENT PROJECTS DONOR AGENCY E-GOVERNMENT E-PROCUREMENT ECONOMETRICS ECONOMIC EFFICIENCY ECONOMIC THEORY ECONOMIES OF SCALE ELECTRICITY ENDOGENOUS VARIABLES EQUATIONS EQUILIBRIUM EQUIPMENT EVALUATION SYSTEM EVALUATION SYSTEMS EXOGENOUS VARIABLES FOREIGN BIDDERS FOREIGN COMPANIES FOREIGN FIRMS FUNCTIONAL FORMS GOVERNMENT PROCUREMENT ICT INFRASTRUCTURE DEVELOPMENT INSTALLATION INTERNATIONAL FIRMS JOINT VENTURES LEAST COST ANALYSIS MARKET CONCENTRATION MARKETPLACE MULTINATIONAL COMPANIES POLITICAL ECONOMY POTENTIAL BIDDERS PRICE BID PRICE COMPARISON PRICE COMPETITION PRICE CRITERIA PRIVATE INFORMATION PRIVATE PARTNERSHIP PROCUREMENT PROCUREMENT PROCESS PROCUREMENTS PROSPECTIVE BIDDERS PUBLIC PUBLIC CONTRACTS PUBLIC ENTITIES PUBLIC PROCUREMENT PUBLIC PROCUREMENT SYSTEMS PUBLIC TENDERS PUBLIC WORKS QUALIFICATION REQUIREMENTS QUALIFIED BIDDERS QUALIFIED FIRMS QUALITY REQUIREMENTS QUALITY STANDARD QUALITY STANDARDS RESULT RESULTS SUBSTITUTE TECHNICAL REQUIREMENTS TECHNICAL SPECIFICATIONS TECHNICAL STANDARD TECHNICAL STANDARDS TENDERING TRANSMISSION USER WAGES WEB WINNING BID Infrastructure projects are often technically complicated and highly customized. Therefore, procurement competition tends to be limited. Competition is the single most important factor toward auction efficiency and anti-corruption. However, the degree of competition realized is closely related to bidders' entry decision and the auctioneer's decision on how to assess technical attributes in the bid evaluation process. This paper estimates the interactive effects among quality, entry, and competition. With data on procurement auctions for electricity projects in developing countries, it is found that large electricity works are by nature costly and can attract only a few participants. The limited competition would raise government procurement costs. In addition, high technical requirements are likely to be imposed for these large-scale projects, which will in turn add extra costs for the better quality of works and further limit bidder participation. The evidence suggests that quality is of particular importance in large infrastructure projects and auctioneers cannot easily substitute price for quality. 2012-03-19T19:09:04Z 2012-03-19T19:09:04Z 2009-03-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090304110004 http://hdl.handle.net/10986/4049 English Policy Research working paper ; no. WPS 4853 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper The World Region The World Region |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
ADMINISTRATIVE COSTS AFFILIATED ORGANIZATIONS ANTI-CORRUPTION AUCTION AUCTION PROCESS AUCTIONS BID EVALUATION BID EVALUATION PROCESS BID PRICE BIDDER BIDDERS BIDS CAPABILITIES CIVIL WORKS COLLUSION COMMUNICATION TECHNOLOGY COMPARATIVE ADVANTAGE COMPETITION POLICY COMPETITIVE BIDDING CONSTRUCTION WORKS CONTRACTOR CONTRACTORS COST ESTIMATE COST ESTIMATES COVARIANCE MATRICES DEVELOPMENT ASSISTANCE DEVELOPMENT PROJECTS DONOR AGENCY E-GOVERNMENT E-PROCUREMENT ECONOMETRICS ECONOMIC EFFICIENCY ECONOMIC THEORY ECONOMIES OF SCALE ELECTRICITY ENDOGENOUS VARIABLES EQUATIONS EQUILIBRIUM EQUIPMENT EVALUATION SYSTEM EVALUATION SYSTEMS EXOGENOUS VARIABLES FOREIGN BIDDERS FOREIGN COMPANIES FOREIGN FIRMS FUNCTIONAL FORMS GOVERNMENT PROCUREMENT ICT INFRASTRUCTURE DEVELOPMENT INSTALLATION INTERNATIONAL FIRMS JOINT VENTURES LEAST COST ANALYSIS MARKET CONCENTRATION MARKETPLACE MULTINATIONAL COMPANIES POLITICAL ECONOMY POTENTIAL BIDDERS PRICE BID PRICE COMPARISON PRICE COMPETITION PRICE CRITERIA PRIVATE INFORMATION PRIVATE PARTNERSHIP PROCUREMENT PROCUREMENT PROCESS PROCUREMENTS PROSPECTIVE BIDDERS PUBLIC PUBLIC CONTRACTS PUBLIC ENTITIES PUBLIC PROCUREMENT PUBLIC PROCUREMENT SYSTEMS PUBLIC TENDERS PUBLIC WORKS QUALIFICATION REQUIREMENTS QUALIFIED BIDDERS QUALIFIED FIRMS QUALITY REQUIREMENTS QUALITY STANDARD QUALITY STANDARDS RESULT RESULTS SUBSTITUTE TECHNICAL REQUIREMENTS TECHNICAL SPECIFICATIONS TECHNICAL STANDARD TECHNICAL STANDARDS TENDERING TRANSMISSION USER WAGES WEB WINNING BID |
| spellingShingle |
ADMINISTRATIVE COSTS AFFILIATED ORGANIZATIONS ANTI-CORRUPTION AUCTION AUCTION PROCESS AUCTIONS BID EVALUATION BID EVALUATION PROCESS BID PRICE BIDDER BIDDERS BIDS CAPABILITIES CIVIL WORKS COLLUSION COMMUNICATION TECHNOLOGY COMPARATIVE ADVANTAGE COMPETITION POLICY COMPETITIVE BIDDING CONSTRUCTION WORKS CONTRACTOR CONTRACTORS COST ESTIMATE COST ESTIMATES COVARIANCE MATRICES DEVELOPMENT ASSISTANCE DEVELOPMENT PROJECTS DONOR AGENCY E-GOVERNMENT E-PROCUREMENT ECONOMETRICS ECONOMIC EFFICIENCY ECONOMIC THEORY ECONOMIES OF SCALE ELECTRICITY ENDOGENOUS VARIABLES EQUATIONS EQUILIBRIUM EQUIPMENT EVALUATION SYSTEM EVALUATION SYSTEMS EXOGENOUS VARIABLES FOREIGN BIDDERS FOREIGN COMPANIES FOREIGN FIRMS FUNCTIONAL FORMS GOVERNMENT PROCUREMENT ICT INFRASTRUCTURE DEVELOPMENT INSTALLATION INTERNATIONAL FIRMS JOINT VENTURES LEAST COST ANALYSIS MARKET CONCENTRATION MARKETPLACE MULTINATIONAL COMPANIES POLITICAL ECONOMY POTENTIAL BIDDERS PRICE BID PRICE COMPARISON PRICE COMPETITION PRICE CRITERIA PRIVATE INFORMATION PRIVATE PARTNERSHIP PROCUREMENT PROCUREMENT PROCESS PROCUREMENTS PROSPECTIVE BIDDERS PUBLIC PUBLIC CONTRACTS PUBLIC ENTITIES PUBLIC PROCUREMENT PUBLIC PROCUREMENT SYSTEMS PUBLIC TENDERS PUBLIC WORKS QUALIFICATION REQUIREMENTS QUALIFIED BIDDERS QUALIFIED FIRMS QUALITY REQUIREMENTS QUALITY STANDARD QUALITY STANDARDS RESULT RESULTS SUBSTITUTE TECHNICAL REQUIREMENTS TECHNICAL SPECIFICATIONS TECHNICAL STANDARD TECHNICAL STANDARDS TENDERING TRANSMISSION USER WAGES WEB WINNING BID Estache, Antonio Iimi, Atsushi Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement |
| geographic_facet |
The World Region The World Region |
| relation |
Policy Research working paper ; no. WPS 4853 |
| description |
Infrastructure projects are often
technically complicated and highly customized. Therefore,
procurement competition tends to be limited. Competition is
the single most important factor toward auction efficiency
and anti-corruption. However, the degree of competition
realized is closely related to bidders' entry decision
and the auctioneer's decision on how to assess
technical attributes in the bid evaluation process. This
paper estimates the interactive effects among quality,
entry, and competition. With data on procurement auctions
for electricity projects in developing countries, it is
found that large electricity works are by nature costly and
can attract only a few participants. The limited competition
would raise government procurement costs. In addition, high
technical requirements are likely to be imposed for these
large-scale projects, which will in turn add extra costs for
the better quality of works and further limit bidder
participation. The evidence suggests that quality is of
particular importance in large infrastructure projects and
auctioneers cannot easily substitute price for quality. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Estache, Antonio Iimi, Atsushi |
| author_facet |
Estache, Antonio Iimi, Atsushi |
| author_sort |
Estache, Antonio |
| title |
Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement |
| title_short |
Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement |
| title_full |
Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement |
| title_fullStr |
Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement |
| title_full_unstemmed |
Auctions with Endogenous Participation and Quality Thresholds : Evidence from ODA Infrastructure Procurement |
| title_sort |
auctions with endogenous participation and quality thresholds : evidence from oda infrastructure procurement |
| publishDate |
2012 |
| url |
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090304110004 http://hdl.handle.net/10986/4049 |
| _version_ |
1764389680466362368 |