search query: @indexterm Subsidies / total: 222
reference: 19 / 222
| Author: | Marion, J. |
| Title: | Are bid preferences benign? The effect of small business subsidies in highway procurement auctions |
| Journal: | Journal of Public Economics
2007 : AUG, VOL. 91:7-8, p. 1591-1624 |
| Index terms: | auctions discrimination affirmative action small business subsidies cost effectiveness construction industry roads USA |
| Language: | eng |
| Abstract: | In procurement (hereafter as: proc.) auctions (here as: actns.), bid preferences allow firms from an identifiable group an advantage in bidding against unfavoured firms. This paper uses data from California actns. for road construction contracts, where small businesses receive a 5-percent bid preference in actns. for projects using only state funds (and none on projects using federal aid). Among others, it is found/shown that while firms' bidding behaviour matches theoretical predictions, proc. costs are 3.8 percent higher on actns. using preferences. The higher proc. cost in preference actns. is attributed to reduced participation by lower cost large firms etc. |
SCIMA