Download or read book Identifying Collusion in English Auctions written by Vadim Marmer and published by . This book was released on 2017 with total page 49 pages. Available in PDF, EPUB and Kindle. Book excerpt: We develop a fully nonparametric identification framework and a test of collusion in ascending bid auctions. Assuming efficient collusion, we show that the underlying distributions of values can be identified despite collusive behaviour when there is at least one bidder outside the cartel. We propose a nonparametric estimation procedure for the distributions of values and a bootstrap test of the null hypothesis of competitive behaviour against the alternative of collusion. Our framework allows for asymmetric bidders, and the test can be performed on individual bidders. The test is applied to the Guaranteed Investment Certificate auctions conducted by US municipalities over the Internet. Despite the fact that there have been allegations of collusion in this market, our test does not detect deviations from competition. A plausible explanation of this finding is that the Internet auction design involves very limited information disclosure.
Download or read book Three Essays on Collusion in English Auctions written by Uma Kaplan and published by . This book was released on 2018 with total page 109 pages. Available in PDF, EPUB and Kindle. Book excerpt: This thesis is composed of three chapters that examine topics related to collusion in English auctions. In the first chapter, we develop a fully nonparametric identification framework and a test of collusion in ascending bid auctions. Assuming efficient collusion, we show that the underlying distributions of values can be identified despite collusive behavior when there is at least one known competitive bidder. We propose a nonparametric estimation procedure for the distributions of values and a bootstrap test of the null hypothesis of competitive behavior against the alternative of collusion. In the second chapter, we adopt a copula-based approach to identification. We succeed in showing that joint distribution function of private valuations is identifiable under certain conditions. Finally, we propose a semiparametric strategy, based on Archimedean copulas, to identify and estimate the model primitives and analyze the dependence relation between bids in English auctions. One advantage this approach has is that it allows us to separate the estimation of the marginal distribution from the estimation of the joint distribution of underlying bidder values. The third chapter is an empirical study of the municipal GIC auctions, motivated by the theoretical frameworks developed in the first two chapters.
Download or read book Detecting Collusion in Timber Auctions written by and published by World Bank Publications. This book was released on 2006 with total page 58 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: Romania was one of the first transition countries in Europe to introduce auctions for allocating standing timber (stumpage) in public forests. In comparison with the former system in the country-administrative allocation at set prices-timber auctions offer several potential advantages: greater revenue generation for the government, a higher probability that tracts will be allocated to the firms that value them most highly, and stronger incentives for technological change within industry and efficiency gains in the public sector. Competition is the key to realizing these advantages. Unfortunately, collusion among bidders often limits competition in timber auctions, including in well-established market economies such as the United States. The result is that tracts sell below their fair market value, which undermines the advantages of auctions. This paper examines the Romanian auction system, with a focus on the use of econometric methods to detect collusion. It begins by describing the historical development of the system and the principal steps in the auction process. It then discusses the qualitative impacts of various economic and institutional factors, including collusion, on winning bids in different regions of the country. This discussion draws on information from a combination of sources, including unstructured interviews conducted with government officials and company representatives during 2003. Next, the paper summarizes key findings from the broader research literature on auctions, with an emphasis on empirical studies that have developed econometric methods for detecting collusion. It then presents an application of such methods to timber auction data from two forest directorates in Romania, Neamt and Suceava. This application confirms that data from Romanian timber auctions can be used to determine the likelihood of collusion, and it suggests that collusion reduced winning bids in Suceava in 2002 and perhaps also in Neamt. The paper concludes with a discussion of actions that the government can take to reduce the incidence of collusion and minimize its impact on auction outcomes.
Download or read book Bids as a Vehicle of Mis Information written by Marco Pagnozzi and published by . This book was released on 2011 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In an English auction, a bidder's strategy depends on the prices at which his competitors drop out, because these convey information on the value of the object on sale. A ring of colluding bidders can strategically manipulate the information transmitted through its members' bids, in order to mislead other bidders into bidding less aggressively and thus allow a designated bidder to bid more aggressively. Collusion increases the probability that the ring wins the auction and reduces the price it pays. The presence of a ring harms other bidders (as well as the seller) and reduces efficiency.
Download or read book Putting Auction Theory to Work written by Paul Milgrom and published by Cambridge University Press. This book was released on 2004-01-12 with total page 378 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book provides a comprehensive introduction to modern auction theory and its important new applications. It is written by a leading economic theorist whose suggestions guided the creation of the new spectrum auction designs. Aimed at graduate students and professionals in economics, the book gives the most up-to-date treatments of both traditional theories of 'optimal auctions' and newer theories of multi-unit auctions and package auctions, and shows by example how these theories are used. The analysis explores the limitations of prominent older designs, such as the Vickrey auction design, and evaluates the practical responses to those limitations. It explores the tension between the traditional theory of auctions with a fixed set of bidders, in which the seller seeks to squeeze as much revenue as possible from the fixed set, and the theory of auctions with endogenous entry, in which bidder profits must be respected to encourage participation.
Download or read book Detecting Large Scale Collusion in Procurement Auctions written by Kei Kawai and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper documents evidence of widespread collusion among construction firms using a novel dataset covering most of the construction projects procured by the Japanese national government from 2003 to 2006. By examining rebids that occur for auctions when all (initial) bids fail to meet the reserve price, we identify collusion using ideas similar to regression discontinuity. We identify about 1,000 firms whose conduct is inconsistent with competitive behavior. These bidders were awarded about 7,600 projects, or close to one fifth of the total number of construction projects in our sample. The value of these projects totals about $8.6 billion.
Download or read book Identification and Inference in First Price Auctions with Collusion written by Karl Edward Schurter and published by . This book was released on 2017 with total page 111 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation develops a method to detect collusion and estimate its effect on the seller's revenue in first-price auctions with independent, private valuations. The challenge is that collusion may be difficult to detect because colluders can use a simple and costless strategy to make their bids appear competitive. If the econometrician observes an exogenous shifter of the level of competition in the auction in addition to the winning bids, a statistical test for collusion by a given bidder can be formulated as a test of independence between the exogenous shifter and the valuations that rationalize its bids under the null hypothesis that it is not colluding. Simulations confirm this test performs well even when colluders attempt to disguise their behavior. I then adopt a multiple hypothesis testing framework to simultaneously test for collusion bidder by bidder. By controlling the probability of making one or more type I errors, the set of rejected hypotheses serves as a lower confidence bound on the set of colluders. To produce a lower confidence bound on the cost of collusion, I use consistent estimates of the bidders' valuation distributions to numerically solve for the seller's expected revenues in auctions with and without collusion. To provide an example of this identification strategy, I use exogenous variation in the reserve prices at British Columbia's timber auctions to estimate the extent of collusion in the years preceding a lumber trade dispute between the United States and Canada.
Download or read book Auctioning Public Assets written by Maarten Christiaan Wilhelmus Janssen and published by Cambridge University Press. This book was released on 2004 with total page 340 pages. Available in PDF, EPUB and Kindle. Book excerpt: In many countries all over the world, governments are privatising firms that were previously under public control. This is happening, for example, in public utility sectors such as gas, water and electricity, in transport sectors (such as rail and metro) and in radio and telephony. This book provides an overview of the economic issues that are involved in this transfer of ownership of public assets. Combining a theoretical framework with a set of case studies of recent sales of state-owned assets from Europe and the USA, it asks which sort of allocation mechanism can a government adopt? Which is most suited to a particular sale? And how will the choice of allocation mechanism affect future market outcomes? With contributions from international experts, this book offers an accessible introduction to auction theory and an invaluable, non-technical analysis of existing knowledge. It will be of interest to students, non-specialists and policy-makers alike.
Download or read book Electricity Auctions written by Luiz Maurer and published by World Bank Publications. This book was released on 2011-07-25 with total page 181 pages. Available in PDF, EPUB and Kindle. Book excerpt: Electricity-contract auctions have been getting increased attention as they have emerged as a successful mechanism to procure new generation capacity and. This book presents a comprehensive overview of international experiences in auction design and implementation.
Download or read book Using the Spatial Distribution of Bidders to Detect Collusion in the Marketplace written by Michael K. Price and published by . This book was released on 2008 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study develops identification strategies utilizing spatial bidding patterns to detect possible collusion in auction markets. The identification strategy is applied to examine bidder behavior using data drawn from nearly 3,000 auctions (over 10,000 individual bids) for cutting rights of standing timber in British Columbia for the period 1996-2000. Results suggest that observed patterns of behavior are inconsistent with a model of perfectly competitive bidding. Further, changes in such patterns across geographic space are remarkably consistent with patterns of decay in the transmission of knowledge reported in previous empirical work on spillovers.
Download or read book Collusion and the Choice of Auction written by Jeroen Hinloopen and published by . This book was released on 2010 with total page 19 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Oxford Handbook of International Antitrust Economics written by Roger D. Blair and published by Oxford Handbooks. This book was released on 2015 with total page 665 pages. Available in PDF, EPUB and Kindle. Book excerpt: More than any other area of regulation, antitrust economics shapes law and policy in the United States, the Americas, Europe, and Asia. In a number of different areas of antitrust, advances in theory and empirical work have caused a fundamental reevaluation and shift of some of the assumptions behind antitrust policy. This reevaluation has profound implications for the future of the field. The Oxford Handbook of International Antitrust Economics has collected chapters from many of the leading figures in antitrust. In doing so, this two volume Handbook provides an important reference guide for scholars, teachers, and practitioners. However, it is more than a merely reference guide. Rather, it has a number of different goals. First, it takes stock of the current state of scholarship across a number of different antitrust topics. In doing so, it relies primarily upon the economics scholarship. In some situations, though, there is also coverage of legal scholarship, case law developments, and legal policies. The second goal of the Handbook is to provide some ideas about future directions of antitrust scholarship and policy. Antitrust economics has evolved over the last 60 years. It has both shaped policy and been shaped by policy. The Oxford Handbook of International Antitrust Economics will serve as a policy and research guide of next steps to consider when shaping the future of the field of antitrust.
Download or read book Testing for Collusion in Asymmetric First Price Auctions written by Gaurab Aryal and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper proposes a two step procedure to detect collusion in asymmetric first-price procurement (auctions). First, we use a reduced form test to short-list bidders whose bidding behavior is at-odds with competitive bidding; and Second, we estimate the (latent) cost for these bidders under both competition and collusion setups. Since, for the same bid the recovered cost must be smaller under collusion- as collusion increases the mark-up- than under competition, detecting collusion boils down to testing for first-order stochastic dominance, for which we use the classic Kolmogorov-Smirnov and Wilcoxon-Mann-Whitney tests. Our Bootstrap based Monte Carlo experiments for asymmetric bidders confirm that the procedure has good power to detect collusion when there is collusion. We implement the tests for Highway Procurement data in California and conclude that there is no evidence of collusion even though the reduced form test supports collusion. This highlights potential pitfalls of inferring collusion based only on reduced form tests.
Download or read book Auctions written by Paul Klemperer and published by Princeton University Press. This book was released on 2018-06-05 with total page 263 pages. Available in PDF, EPUB and Kindle. Book excerpt: Governments use them to sell everything from oilfields to pollution permits, and to privatize companies; consumers rely on them to buy baseball tickets and hotel rooms, and economic theorists employ them to explain booms and busts. Auctions make up many of the world's most important markets; and this book describes how auction theory has also become an invaluable tool for understanding economics. Auctions: Theory and Practice provides a non-technical introduction to auction theory, and emphasises its practical application. Although there are many extremely successful auction markets, there have also been some notable fiascos, and Klemperer provides many examples. He discusses the successes and failures of the one-hundred-billion dollar "third-generation" mobile-phone license auctions; he, jointly with Ken Binmore, designed the first of these. Klemperer also demonstrates the surprising power of auction theory to explain seemingly unconnected issues such as the intensity of different forms of industrial competition, the costs of litigation, and even stock trading 'frenzies' and financial crashes. Engagingly written, the book makes the subject exciting not only to economics students but to anyone interested in auctions and their role in economics.
Download or read book A Study of Collusion in First Price Auctions written by Martin Pesendorfer and published by . This book was released on 2001 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the bidding for school milk contracts in Florida and Texas during the 1980s. In both states firms were convicted of bid-rigging. The data and legal evidence suggest that the cartels in the two states allocate contracts in different ways: One cartel divides the market among members, while the other cartel also uses side payments to compensate that both forms of cartel agreements are almost optimal, provided the number of contracts is sufficiently large. In the auction the cartel bidder may face competition from non-cartel bidders. The presence of an optimal cartel induces an asymmetry in the auction. The selected cartel bidder is bidding as a representative of a group and has on average a lower cost than a non-cartel bidder. The data support the predicted equilibrium bidding behaviour in asymmetric auctions in accordance with optimal cartels.
Download or read book Collusion Detection in Auctions Using Machine Learning Algorithms written by Muskan Rathi and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This interdisciplinary honors thesis in Computational Economics investigates the different methods to compute auction equilibria and the impact of collusion on auction outcomes and the effectiveness of various machine learning algorithms in detecting collusive behavior using real-world datasets. We develop a program to analyze the Bayesian Nash equilibrium strategies of bidders in first-price and second-price auctions under scenarios with and without collusion. We further explore the performance of different machine learning algorithms, including Support Vector Machine (SVM), which demonstrates the highest F1 score in detecting collusion among the tested algorithms. The challenges associated with obtaining real-life auction data necessitate the use of synthetic data, providing a valuable resource for developing and validating anti-collusion algorithms in the future.This research contributes to a deeper understanding of auction dynamics and collusion, informing policymakers and regulators in designing robust auction mechanisms, implementing effective anti-collusion measures, and promoting fair and efficient market outcomes.
Download or read book Collusive Bidder Behavior at a Single Object English Auction written by Daniel A. Graham and published by . This book was released on 1985 with total page 78 pages. Available in PDF, EPUB and Kindle. Book excerpt:
