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Efficient procurement with quality concerns*

Published online by Cambridge University Press:  17 August 2016

Pierre-Henri Morand  and
Lionel Thomas
Lionel Thomas
Affiliation:
CRESE, Université de Franche-Comté, France
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Summary

In this paper, we design the optimal procurement mechanisms when bidders areprivately informed on efficiency and on observable but neither verifiablenor contractible quality. We show that most of the optimal procurementinstitutions are mixed procedure implying both separation and pooling. Thus,the existing take-it-or-leave-it offers and procurement auction appear onlyas polar cases. Moreover, we show that separation and pooling may affect theallocative efficiency of the procurement in a counterintuitive way, suchthat a less bunching mechanism can be a more inefficient one.

Résumé:

Résumé:

Cet article caractérise les mécanismes d'approvisionnement optimaux, lorsqueles offreurs détiennent une information privée sur leur paramètred'efficacité productive ainsi que sur le niveau de qualité, observable maisni vérifiable ni contractualisable, qu'ils sont en mesure d'offrir. Nousmontrons que la plupart des mécanismes optimaux correspondent à desprocédures « mixtes » impliquant simultanément séparation et mélange decer-tains types d'offreurs, alors que les procédures traditionnelles de laforme « à prendre ou à laisser » ou d'enchère ne s'avèrent optimales quedans des situations extrêmes. De plus, nous établissons que les propriétésmélangeantes ou séparatrices affectent l'efficacité allocative de laprocédure, de manière potentiellement contre-intuitive, une procédure moinsmélangeante pouvant également être moins efficace.

Keywords

mécanismes optimauxapprovisionnementqualité non-contractualisableD44D82mechanism designprocurementnon-contractible qualityD44D82

Information

Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 72 , Issue 2 , 2006 , pp. 129 - 155
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 2006 

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Footnotes

**

Université de Franche Comté, UFR SJEPG, 45D avenue de l'Observatoire, 25030 Besançon cedex, France.

*

The authors are very grateful to Mark Armstrong and anonymousreferees. Usual disclaimers apply.

References

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