Scoring rule auctions and favoritism: an empirical study on Italian public procurement for canteens

Riccardo Camboni Marchi Adani ()
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Riccardo Camboni Marchi Adani: Department of Economics (University of Verona)

No 08/2016, Working Papers from University of Verona, Department of Economics

Abstract: We built an original dataset of 307 auctions aimed at awarding canteen services in Italy; it contains scoring rules, first price, and average bid mechanisms. We exploit this dataset to test the degree of competitiveness and the presence of favoritism by public contracting authorities (CAs) towards a possibly predetermined bidder. We start with a working hypothesis: a presumption of which auctions were competitive; we then run an econometric test and construct a variable that individuates possible non-competitive behaviors. Our results highlight that scoring rules can be distorted to favor a bidder, and the victory of the incumbent is associated with lower competition, which is a sign of favoritism.

Pages: 37
Date: 2016-05
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