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Designing incentive mechanisms to reduce public spending: A Field Experiment in Government Procurement
Marcelo Olivares
Universidad de Chile, Chile
We use a cluster randomized field experiment to study the effect of performance monitoring on the efficiency of public procurement in Chile. In collaboration with the Chilean Public Procurement Office, we provided monthly reports on the purchasing performance of individual procurement officers and services. After 5 months of treatment exposure, we find that the reports generated significant reductions in overspending in interventions that point towards extrinsic motivation of buyers.
On the timing of auctions: the effects of complementarities on bidding, participation, and welfare
Hayri Alper Arslan, Alex Arsenault Arsenault-Morin, Matthew Gentry
TBD
Problem: This paper examines the impact of auction timing on bidder behavior and welfare. Methodology/Results: A structural auction model is developed and applied to real data. Complementarities in bids are found to affect contract combinations. An optimization algorithm for auction schedules is proposed. Managerial Implications: Optimizing auction schedules can reduce procurement costs by over 8%.