Imitation perfection: A simple rule to prevent discrimination in procurement

Helene Mass, Nicolas Fugger, Vitali Gretschko and Achim Wambach

No 17-058, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: Procurement regulation aimed at curbing discrimination requires equal treatment of sellers. However, Deb and Pai (2017) show that such regulation imposes virtually no restrictions on the ability to discriminate. We propose a simple rule - imitation perfection - that restricts discrimination significantly. It ensures that in every equilibrium bidders with the same value distribution and the same valuation earn the same expected surplus. If all bidders are homogeneous, revenue and social surplus optimal auctions which are consistent with imitation perfection exist. For heterogeneous bidders however, it is incompatible with revenue and social surplus optimization. Thus, a trade-off between non-discrimination and optimality exists.

Keywords: discrimination; symmetric auctions; procurement regulation (search for similar items in EconPapers)
JEL-codes: D44 D73 D82 L13 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-gth and nep-mic
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https://www.econstor.eu/bitstream/10419/171742/1/1006269118.pdf (application/pdf)

Related works:
Journal Article: Imitation Perfection—A Simple Rule to Prevent Discrimination in Procurement (2020)
Working Paper: Imitation Perfection - A Simple Rule to Prevent Discrimination in Procurement (2020)
Working Paper: Imitation perfection - a simple rule to prevent discrimination in procurement (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:17058

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