Faculty of Arts and Social Sciences
Optimal Bidder Participation in Public Procurement Auctions
Bedri Kamil Onur Taş
Wednesday, March 21, 2018
11:45-13:15 FASS 2034
This paper empirically identifies the optimal number of bidders to achieve lowest procurement prices in public procurement auctions. We examine a unique data set that covers all Turkish government procurement auctions comprising more than half a million observations. We present a new and easy-to-implement method to investigate the number of bidders required for the public procurement markets to be competitive. The results suggest that procurement costs decrease until nine to ten bidders participate. These results have several policy implications. Policy makers can use the method to investigate optimal number of bidders and design policies to promote competition. Policy makers can employ them as focal points to analyze whether competitive efficiency is achieved in public procurement auctions.