Detecting Bidders Groups in Collusive Auctions

Timothy Conley and Francesco Decarolis

American Economic Journal: Microeconomics, 2016, vol. 8, issue 2, 1-38

Abstract: We study entry and bidding in procurement auctions where contracts are awarded to the bid closest to a trimmed average bid. These auctions, common in public procurement, create incentives to coordinate bids to manipulate the bid distribution. We present statistical tests to detect coordinated entry and bidding choices. The tests perform well in a validation dataset where a court case makes coordination observable. We use the tests to detect coordination in a larger dataset where it is suspected, but not known. The results are used to interpret a major market shakeout following a switch to first price auctions. (JEL D44, D47, H57, R42)

JEL-codes: D44 D47 H57 R42 (search for similar items in EconPapers)
Date: 2016
Note: DOI: 10.1257/mic.20130254
References: Add references at CitEc
Citations: View citations in EconPapers (72)

Downloads: (external link)
https://www.aeaweb.org/articles?id=10.1257/mic.20130254 (application/pdf)
https://www.aeaweb.org/aej/mic/data/0802/2013-0254_data.zip (application/zip)
https://www.aeaweb.org/aej/mic/app/0802/2013-0254_app.pdf (application/pdf)
https://www.aeaweb.org/aej/mic/ds/0802/2013-0254_ds.zip (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:aejmic:v:8:y:2016:i:2:p:1-38

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Journal: Microeconomics is currently edited by Johannes Hörner

More articles in American Economic Journal: Microeconomics from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().