Procurement auctions under quality manipulation corruption

Yangguang Huang and Jijun Xia

European Economic Review, 2019, vol. 111, issue C, 380-399

Abstract: In procurement, quality manipulation corruption arises when the agent tasked with quality evaluation exaggerates the quality of a corrupt firm. If an inefficient firm is favored by the agent, the buyer can adjust the procurement mechanism such that the corruption rent of the inefficient firm erodes the technological rent of the efficient firm; however, doing so may require procuring the project at an undesirable quality level. To resolve this trade-off between corruption deterrence and quality distortion, unlike standard results in the literature, the buyer may overstate her preference for quality, and the dominance of scoring auctions over minimum-quality auctions disappears.

Keywords: Scoring auction; Quality manipulation; Corruption; Procurement (search for similar items in EconPapers)
JEL-codes: D44 D73 H57 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0014292118301818
Full text for ScienceDirect subscribers only

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:eee:eecrev:v:111:y:2019:i:c:p:380-399

DOI: 10.1016/j.euroecorev.2018.11.001

Access Statistics for this article

European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer

More articles in European Economic Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().