Topic: All Pay Quality-Bids in Score Procurement Auctions

Lecturer: Prof.Jingfeng Lv, Department of Economics, National University of Singapore

Time: 15:00-16:30 p.m. June 29th, 2023

Venue: B321 Zhixin Building, Central Campus

Abstract: We study score procurement auctions with all-pay quality bids, in which a supplier's score is the difference between his quality and price bids. Equilibrium quality and price bids are solved without first obtaining the corresponding equilibrium scores. When the convex effort cost function takes a power form, a higher all-pay component of the quality bid reduces quality provision, total surplus and suppliers' payoffs, but may increase or decrease the procurer’s payoff. If the procurer reimburses the all-pay components of losing suppliers or all suppliers, this would increase quality provision and suppliers' payoffs, but reduce total surplus and the procurer's payoff.