Strategic design under uncertain evaluations: structural analysis of design‐build auctions.

Abstract: I investigate firms' competition over price and product design under uncertain design evaluations in the context of Design‐Build (DB) auctions. Reviewers' design evaluations contain uncertainty from a bidder's perspective, leading luck to dampen differences in the firms' chances of winning...

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Publicado en:RAND Journal of Economics (Wiley-Blackwell) Vol. 49; no. 3; pp. 594 - 619
Autor principal: Takahashi, Hidenori
Formato: Artículo
Publicado: Wiley-Blackwell Fall2018
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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      pub: Wiley-Blackwell
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        131408120
        10.1111/1756-2171.12246
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      tig:
        atl: Strategic design under uncertain evaluations: structural analysis of design‐build auctions.
      aug:
        au: Takahashi, Hidenori
        affil: University of Mannheim
      su:
        Economic competition
        Design & build contracts
        Structural analysis (Engineering)
        Auctions
        Product design
        Pricing
        Bidders
      sug:
        subj:
          Economic competition
          Industrial Design Services
          Design & build contracts
          Structural analysis (Engineering)
          Auctions
          Product design
          Pricing
          Bidders
      ab: Abstract: I investigate firms' competition over price and product design under uncertain design evaluations in the context of Design‐Build (DB) auctions. Reviewers' design evaluations contain uncertainty from a bidder's perspective, leading luck to dampen differences in the firms' chances of winning. I model bidders' behavior and show semiparametric identification of the model primitives. Uncertain design evaluations increase the expected price of design quality and exacerbate an auctioneer's uncertainty in auction outcomes. These effects are mostly due to changes in bidding strategies. Bid ranking swaps due to uncertain evaluations account for a small share of these effects.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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