Detecting Large-Scale Collusion in Procurement Auctions

Kawai, Kei; Nakabayashi, Jun

doi:10.1086/718913

Cited by 36 publications

(11 citation statements)

References 38 publications

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“…There is a large empirical literature studying or testing for collusion in a wide range of industries; recent examples include vitamins (Igami and Sugaya [2020]), public procurement auctions (Conley and Decarolis [2016]; Kawai and Nakabayashi [2018]; Chassang and Ortner [2019]; Kawai et al . [2019]), airlines (Ciliberto et al .…”

Section: Related Literaturementioning

confidence: 99%

Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?*

Brown

Eckert

2022

The J Industrial Economics

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We examine allegations that firms in Alberta's electricity industry manipulated public information to coordinate in the wholesale market. We investigate whether bids by firms who employed unique pricing patterns were consistent with unilateral expected profit maximization. Our results suggest that these firms could have increased expected profits through unilateral deviations. For one firm, the potential to increase profits is greater on days when certain offer patterns are observed, providing support for the claim that such patterns may have assisted coordination on high-priced outcomes. These results suggest that regulators should exercise caution when designing information disclosure policies in concentrated electricity markets.

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Section: Related Literaturementioning

confidence: 99%

Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?*

Brown

Eckert

2022

The J Industrial Economics

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“…Only about a handful of studies have viewed procurement auctions through a regression discontinuity lens, where bidders that bid close to the cutoff price differ discontinuously in winning or losing the auction. Among the few, Kawai and Nakabayashi (2014) analyze, for the case of Japan, collusion strategies among construction firms. Specifically, they first focus on failed auctions, where the bids of the lowest and second-lowest firms are close to each other.…”

Section: Procurement Auctionsmentioning

confidence: 99%

A comprehensive history of regression discontinuity designs: An empirical survey of the last 60 years

Villamizar‐Villegas

Pinzón-Puerto

Ruiz-Sanchez

2021

Journal of Economic Surveys

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In this paper we detail the entire Regression Discontinuity Design (RDD) history, including its origins in the 1960s, and its two main waves of formalization in the 1970s and 2000s, both of which are rarely acknowledged in the literature. Also, we dissect the empirical work into fuzzy and sharp designs and provide some intuition as to why some rule‐based criteria produce imperfect compliance. Finally, we break the literature down by economic field, highlighting the main outcomes, treatments, and running variables. Overall, we see some topics in economics gaining importance through time, like the cases of health, finance, crime, environment, and political economy. In particular, we highlight applications in finance as the most novel. Nonetheless, we recognize that the field of education stands out as the uncontested RDD champion through time, with the greatest number of empirical applications.

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“…Some of these papers have focused on describing the inner workings of cartels, for instance Pesendorfer (2000), Genesove and Mullin (2001), Roller and Steen (2006), Asker (2010), Clark and Houde (2013), and Igami and Sugaya (2021). Other papers have focused on distinguishing collusion from competition, for instance Porter and Zona (1999), Bajari and Ye (2003), Conley and Decarolis (2016), Aryal and Gabrielli (2013), Schurter (2017), and Kawai and Nakabayashi (2018). Block, Nold, and Sidak (1981) examine collusion in the US bread market in the 1960s and 1970s.…”

Section: Related Literaturementioning

confidence: 99%