Bribery and Its Welfare Effects in First-Price Sealed-Bid Auctions

Download

105-104-1-PB.pdf

Date

2006-12

Author

Koç, Ş. Alper

Metadata

Show full item record

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Item Usage Stats

82
views

21
downloads

I study an auction in which the auctioneer, an agent of the seller, approaches all the bidders and tells them that if they pay a bribe and if they submit the highest bid, he will change their bid so that they only have to pay the second-highest bid. In equilibrium, only bidders who have valuations higher than some critical value pay the bribe, and they bid their valuations. Corruption has no effect on either the efficiency of the auction or the expected payoffs of the bidders. However, bribery results in a transfer of wealth from the seller to the auctioneer.

URI

http://www2.feas.metu.edu.tr/metusd/ojs/index.php/metusd/article/view/105/76
https://hdl.handle.net/11511/58409

Journal

ODTÜ Gelişme Dergisi

Collections

Department of Economics, Article

Suggestions

OpenMETU
Core

Improving efficiency in multiple-unit combinatorial auctions: Bundling bids from multiple bidders Köksalan, Mustafa Murat; Leskela, Riikka-Leena; Wallenius, Hannele; Wallenius, Jyrki (Elsevier BV, 2009-12-01) In multiple-unit combinatorial auctions both bidders and bid takers can benefit from support mechanisms that suggest new bids for the bidders. We present a support tool called Group Support Mechanism, which suggests bundles of bids to several bidders not among the provisional winners. It improves upon the Quantity Support Mechanism we developed earlier. The efficiency of the final allocation is better when the Group Support Mechanism is used instead of the Quantity Support Mechanism, especially in cases whe...
Corruption and intermediaries - A game theoretical approach Bayar, Güzin (Orta Doğu Teknik Üniversitesi (Ankara, Turkey), 2009-6-1) The aim of the article is to examine a bribee-initiated corrupt transaction and the role of intermediaries in such a transaction, using a game theoretical model. Corrupt officers, who want to obtain a bribe from the public services they offer, use their power to increase red tape to enforce clients to pay a bribe. However, if the officer demands a bribe directly from the clients, they face the risk of demanding a bribe from a "whistleblower" client, who has high ethical values and complains to the law enfor...
Comparison of international federation of consulting engineers and general specification for public works contracts from risk management perspective Usta, Ergun; Birgönül, Mustafa Talat; Department of Civil Engineering (2005) Contractors have to construct the projects efficiently in accordance with the contract provisions when they accept a contract. All construction projects involve risk and there is no possibility to eliminate all the risks associated with a specific project. Management of risk requires identification and analysis of risk factors. After this risk assessment step, proper response strategies have to be developed so that an optimum risk-reward structure is ensured. Contracts are the grounds where risk allocation ...
Engineering Effort Estimation for Product Development Projects Yurt, Z. Ozturk; İyigün, Cem; Bakal, P. (2019-01-01) Cost estimation is an essential process for gaining competitive advantage in the bidding phase of every project. Besides, cost estimates are also vital for effective project control. For product development projects engineering hours is the main cost item and hence estimating engineering hours for potential product development projects is an important task.
Interim efficient auctions with interdependent valuations Küçükşenel, Serkan (Springer Science and Business Media LLC, 2012-05-01) We provide a characterization of interim efficient auctions and examine their properties in the presence of informational interdependent valuations. We show that buyers can be awarded the auctioned item less often than the efficient level. We also show that buyers obtain the item more often as the degree of heterogeneity in preferences increases, even though profitability of trade does not depend on the heterogeneity in preferences.

Citation Formats

Ş. A. Koç, “Bribery and Its Welfare Effects in First-Price Sealed-Bid Auctions,” ODTÜ Gelişme Dergisi, vol. 33, no. 2, pp. 207–222, 2006, Accessed: 00, 2020. [Online]. Available: http://www2.feas.metu.edu.tr/metusd/ojs/index.php/metusd/article/view/105/76.