Challenging Market Designs and Procurement Policy Restructuring: School Transportation for Disadvantaged Students

California Institute of Technology, Social Science Working Paper 1448, October 2019

38 Pages Posted: 18 Oct 2019

See all articles by Hsing Lee

Hsing Lee

California Institute of Technology

Travis Maron

California Institute of Technology - Division of the Humanities and Social Sciences

Charles R. Plott

California Institute of Technology - Division of the Humanities and Social Sciences

Han Seo

California Institute of Technology

Gary Stoneham

Government of Victoria - Department of Natural Resources & Environment (NRE)

Date Written: October 9, 2019

Abstract

The paper reports on the design, experimental testing, field implementation and performance of market policy replacements of an administrative procedures for procuring school transportation for disadvantaged children. The project involves route design, special auction design and implementation. The new process produced improved quality of transportation services for the same cost. One-way travel time per child was reduced from 90 minutes on the bus to 64 minutes, a 53% reduction. Robustness analysis demonstrates a close relationship between experimental performance and actual field performance with the special auction (with only three bidders) performing closely to the predictions of economic theory.

Keywords: procurement, market design, experiments, school transportation, route design, auction

Suggested Citation

Lee, Hsing and Maron, Travis and Plott, Charles R. and Seo, Han and Stoneham, Gary, Challenging Market Designs and Procurement Policy Restructuring: School Transportation for Disadvantaged Students (October 9, 2019). California Institute of Technology, Social Science Working Paper 1448, October 2019, Available at SSRN: https://ssrn.com/abstract=3466526 or http://dx.doi.org/10.2139/ssrn.3466526

Hsing Lee

California Institute of Technology ( email )

Pasadena, CA 91125
United States

Travis Maron

California Institute of Technology - Division of the Humanities and Social Sciences ( email )

1200 East California Blvd.
Pasadena, CA 91125
United States

Charles R. Plott (Contact Author)

California Institute of Technology - Division of the Humanities and Social Sciences ( email )

1200 East California Blvd.
337 Baxter Hall
Pasadena, CA 91125
United States
626-395-4209 (Phone)

Han Seo

California Institute of Technology ( email )

Pasadena, CA 91125
United States

Gary Stoneham

Government of Victoria - Department of Natural Resources & Environment (NRE) ( email )

Department of Primary Industries
Melbourne, Victoria
Australia

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