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Endogenous asymmetry in a dynamic procurement auction.

We show how to numerically solve for a Markov-perfect equilibrium of a dynamic auction game where a procurer repeatedly purchases construction services from capacity-constrained firms. We find that the procurer is best off scheduling frequent auctions for small project sizes. Otherwise, firm capacit...

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Published in:RAND Journal of Economics (Wiley-Blackwell) Vol. 43; no. 4; pp. 726 - 761
Main Author: Saini, Viplav
Format: Article
Published: Wiley-Blackwell Winter2012
Subjects:
Economic equilibrium
Business enterprises
Economic competition
Auctions
Industrial capacity
Numerical analysis
Online Access:View this record in EBSCOhost