Analysis of Entrant and Incumbent Bidding in Public Procurement Auctions

Bedri Tas

FinanzArchiv: Public Finance Analysis, 2019, vol. 75, issue 2, 187-204

Abstract: We empirically investigate differences in cost-effectiveness of public procurement auctions that are won by entrants and incumbents. We use a unique data set that covers all Turkish public procurement auctions for the years 2004 to 2010. We find that procurement prices of auctions won by entrants are significantly lower. More than half of the entrants cannot survive in the public procurement market and cannot win more than one auction. Our results indicate that policymakers should cultivate competition and promote entry in public procurement auctions.

Keywords: public procurement auctions; competition; cost effectiveness; entrants; survival (search for similar items in EconPapers)
JEL-codes: C36 D44 H57 (search for similar items in EconPapers)
Date: 2019
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DOI: 10.1628/fa-2019-0002

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