Heterogeneity-promoting optimal procurement

Juan-José Ganuza and Lambros Pechlivanos ()

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: When procurement takes place in the presence of horizontally differentiated contractors, the design of the object being procured affects the resulting degree of competition. This paper highlights the interaction between the optimal procurement mechanism and the design choice. Contrary to conventional wisdom, the sponsor's design choice, instead of homogenizing the market to generate competition, promotes heterogeneity.

Keywords: Procurement; project design; horizontal differentiation (search for similar items in EconPapers)
JEL-codes: D44 H57 L51 (search for similar items in EconPapers)
Date: 1998-01, Revised 1999-01
New Economics Papers: this item is included in nep-mic
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Heterogeneity-promoting optimal procurement (2000)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:377

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