nonparametric estimation of entry cost in first-price procurement auctions (replication data)

In this paper, I investigate Samuelson's low-price auction model with entry costs. The model's equilibrium implies that the distribution of bids is truncated at the threshold for participation. I use the model to estimate the cost of participation in Michigan highway procurement auctions. The null hypothesis of zero entry costs is rejected. Using my empirical results, I then construct an estimate of the optimal auction, which employs regular policy tools such as entry fees. Finally, I demonstrate the savings that the Michigan government could have made on payments if optimal auctions had been employed.

Data and Resources

Suggested Citation

Xu, Pai (2013): NONPARAMETRIC ESTIMATION OF ENTRY COST IN FIRST-PRICE PROCUREMENT AUCTIONS (replication data). Version: 1. Journal of Applied Econometrics. Dataset.