Ratifiable Collusion and Bidding Systems in Procurement

Abstract:     
This study explores stability in efficient collusion in government procurement auctions. In first- and second-price auctions with independent private values, we look at the possibility of vetoing collusion mechanisms and the learning of the other bidders after vetoing. The collusions in first-price auctions in simple case and second-price auctions are stable against the competition after a potential veto to take part in bid-rigging.

Number of Pages in PDF File: 29

Keywords: auctions, bid rigging, collusion, procurement, ratifiability

JEL Classification: C72, D44, D82, L44, H57

working papers series