SPECIAL ISSUE PAPER
Does Multi-Attribute Bidding in Public Construction Projects Prevent Corruption while Tenderers’ Preferences are Open? A Study of China’s Practice
,
 
,
 
 
 
 
More details
Hide details
1
School of Economics and Management, Chongqing University of Posts and Telecommunications, Chongqing, P. R. CHINA
 
2
School of Foreign Languages, Donghua University, Shanghai, P. R. CHINA
 
 
Online publication date: 2017-11-25
 
 
Publication date: 2017-11-25
 
 
EURASIA J. Math., Sci Tech. Ed 2017;13(12):8343-8358
 
This article belongs to the special issue "Problems of Application Analysis in Knowledge Management and Science-Mathematics-Education".
KEYWORDS
TOPICS
ABSTRACT
This paper establishes a method of supply-chain multi-attribute reverse auction. Presuming the tenderers’ preference is open, the paper proposes a non-cooperative multi-attribute bidding game model about public construction projects and analyzes the bidding strategies of tenderers and bidders. Through the simulation of a case in China, we find that: (1) the more committed of the tenderers to construction quality and schedule, the greater benefits, enthusiasm in bidding, and tenderer’s surplus; (2) the bidder’s benefits have a U-shaped relationship respectively with the bidding quality and the construction period; and (3) the greater the bidder’s construction quality and period cost coefficients, the smaller the tenderer’s surplus. Such conclusions indicate, the improvement of the bidding rules or procedures can contribute to restricting the behavior of tenderer and bidder, furthermore reducing the corruption possibility of public construction projects.
 
REFERENCES (61)
1.
Abreu, D. (1986). Extremal equilibria of oligopolistic super games. Journal of Economic Theory, 39(1), 191-225.
 
2.
Ades, A., & Di Tella, R. (1999). Rents, competition and corruption. American Economic Review, 89(4), 982-993.
 
3.
Alutu, O. E. (2007). Unethical practices in Nigerian construction industry: Prospective engineers’ viewpoint. Journal of Professional Issues in Engineering Education and Practice, 133(2), 84-88.
 
4.
Alutu, O. E., & Udhawuve, M. L. (2009). Unethical practices in Nigerian engineering industries: Complications for project management. Journal of Management Engineering, 25:1(40), 40-43.
 
5.
Ameh, O. J., & Odusami, K. T. (2010). Professionals’ ambivalence toward ethics in the Nigerian construction industry. Journal of Professional Issues in Engineering Education and Practice, 136(1), 9-16.
 
6.
Asker, J., & Cantillon, E. (2008). Properties of scoring auctions. The RAND Journal of Economics, 39(1), 69-85.
 
7.
Aslaksen, S. (2009). Corruption and oil: evidence from panel data. Mimeo (Working Paper). Retrieved on 1 February 2015 from http://www.sv.uio.no/econ/pers....
 
8.
Bajari, P., Houghton, S., & Tadelis, S. (2014). Bidding for Incomplete Contracts: An Empirical Analysis of Adaptation Costs. American Economic Review, 104(4), 1288-1319.
 
9.
Berrios R. (2006). Government contracts and contractor behavior. Journal of Business Ethics, 63(2), 119-130.
 
10.
Bowen, P. A., Akintoye, A., Pearl, R., & Edwards, P. J. (2007). Ethical behaviour in the South African construction industry. Construction Management Economics, 25(6), 631-648.
 
11.
Bowen, P. A., Pearl, R., & Akintoye, A. (2007). Professional ethics in the South African construction industry. Building Research and Information, 35(2), 189-205.
 
12.
Branco F. (1997). The design of multidimensional auctions. The Rand Journal of Economics, 28(1), 63-81.
 
13.
Brisset, K., & Maréchal, F. (2014). Right of first refusal versus first-price auction with heterogeneous risk-averse bidders. Besançon: University of Franche-Comté.
 
14.
Brisset, K., Cochard, F., & MaréchalIs, F. (2015). Is the newcomer more aggressive when the incumbent is granted a Right-of-First-Refusal in a procurement auction? Experimental Evidence. Theory and Decision, 78(4), 639-665.
 
15.
Burguet, R., & Perry,M. (2009). Preferred suppliers in auction markets. Rand Journal of Economics, 40(2), 283-295.
 
16.
Busse, M., & Groning, S. (2013). The resource curse revisited: governance and natural resources. Public Choice, 154(1-2), 1-20.
 
17.
Charron, N. (2016). Do corruption measures have a perception problem? Assessing the relationship between experiences and perceptions of corruption among citizens and experts. European Political Science Review, 8(1), 147-171.
 
18.
Che, Y. K. (1993). Design competition through multi-dimensional auctions. The Rand Journal of Economics, 24(12), 668-680.
 
19.
Cheng, H. G., & Tan, G. (2010). Asymmetric common-value auctions with applications to private-value auctions with resale. Economic Theory, 45(1-2), 253-290.
 
20.
Chen-Ritzo, C.-H., Harrison, T. P., Kwasnica, A. M., & Thomas, D. J. (2005). Better, faster, cheaper: A multi-attribute reverse auction mechanism with restricted information feedback. Management Science, 51(12), 1753-1762.
 
21.
Choudhry, R., & Iqbal, K. (2013). Identification of risk management system in construction industry in Pakistan. Journal of Management Engineering, 29(1), 42-49.
 
22.
Cleveland, M., Favo, C. M., Frecka, T. J., & Owens, C. K. L. (2009). Trends in the international fight against bribery and corruption. Journal of Business Ethics, 90(2), 199-244.
 
23.
David, E., Azoulay-Schwartz, R., & Kraus, S. (2006). Bidding in sealed-bid and English multi-attribute auctions. Decision Support Systems, 42(2), 527-556.
 
24.
Ehlermann-Cache, N. (2007). Bribery in public procurement: methods, actors and counter-measures. Paris: OECD.
 
25.
European Commission. (2013). Identifying and Reducing Corruption in Public Procurement in the EU. Brussels: European Commission. Retrieved from http://ec.europa.eu/anti_fraud...- policy/research-and-studies/identifying_reducing_corruption_in_public_procurement_en.pdf.
 
26.
Fudenberg, D., & Tirole, J. (1991). Game theory. MA: MIT Press.
 
27.
Hardoon, D., & Heinrich, F. (2011). Bribe payers index. Berlin: Transparency International.
 
28.
He, H., et al. (2008). Research on the determining of the winner of multi-factor procurement combination auction. Theory and Practice of System Engineering, 28(7), 27-33.
 
29.
Hessami, Z. (2014). Political corruption, public procurement, and budget composition: Theory and evidence from OECD countries. European Journal of Political Economy, 34(6), 372-389.
 
30.
Hong, W., et al. (2010). The optimal mechanism and its implementation in multi-dimensional information bidding. Journal of Management Science, 13(8), 1-14.
 
31.
Huang, H., & Li, Z. (2015). Procurement auctions with ex-ante endogenous bribery. Economic Modelling, 47(6), 111-117.
 
32.
Jensen, N., & Rahman, A. (2015). The silence of corruption. Identifying underreporting of business corruption through randomized response techniques. In P. Heywood (Ed.), Routledge handbook of political corruption (pp. 154-171). London and New York: Routledge.
 
33.
Jong, D., Henry, P., & Stansbury, N. (2009). Eliminating corruption in our engineering/construction industry. Leadership and Management in Engineering, 9, 105-111.
 
34.
Kaufmann, D., Kraay, A., & Mastrutzzi, M. (2010). The worldwide governance indicators: methodology and analytical issues. World Bank Policy Research Paper 5430.
 
35.
Kenny, C. (2009). Transport construction, corruption and developing countries. Transport Reviews: A Transnational Trans-disciplinary Journal, 29(1), 21-41.
 
36.
Kyriacou, A. P., Muinelo-Gallo, L., & Roca-Sagales, O. (2015). Construction corrupts: empirical evidence from a panel of 42 countries. Public Choice, 165, 123-145.
 
37.
Le, Y., Shan, M., Chan, A., & Yi, H. (2014). Overview of corruption research in construction. Journal of Management in Engineering, 30(4), 1-7.
 
38.
Li, J., & Liu, S. (2012). On the multi-attribute procurement auction based on Cobb-Douglas utility function. Journal of Management Science, 15(3), 54-60.
 
39.
Liu, C., & Mikesell, J. (2014). The impact of public officials’ corruption on the size and allocation of U.S. State spending. Public Administration Review, 74(3), 346-359.
 
40.
Neu, D., Everett, J., Rahaman, A. S. (2015). Preventing corruption within government procurement: Constructing the disciplined and ethical subject. Critical Perspectives on Accounting, 28(4), 49-61.
 
41.
Neu, D., Everett, J., Rahaman, S., & Martinez, D. (2013). Accounting and networks of corruption. Account, Orgnizations and Society, 38(6), 505-524.
 
42.
Ostrovnaya, M., & Podkolzina, E. (2015). Antitrust enforcement in public procurement: the case of Russia. Journal of Competition Law & Economics, 11(2), 331–352.
 
43.
Painter-Morland, M. (2011). Rethinking responsible agency in corporations: perspectives from Deleuze and Guattari. Journal of Business Ethics, 101(1), 83-95.
 
44.
Quande, Q., et al. (2012). Fuzzy decisions on the multi-attribute auction of state-owned firms’ M&A under incomplete preference information. Journal of Management Engineering, 26(4), 169-175.
 
45.
Salai Martin, X., & Subramanian, A. (2013). Addressing the natural resource curse: An illustration from Nigeria. Journal of African Economies, 22(4), 570-615.
 
46.
Shan, M., Chan, A. P., Le, Y., & Hu, Y. (2015). Investigating the effectiveness of response strategies for vulnerabilities to corruption in the Chinese public construction sector. Science and Engineering Ethics, 21(3), 683-705.
 
47.
Shleifer, A., & Vishny, R. (1993). Corruption. Quarterly Journal of Economics, 108(3), 599-617.
 
48.
Sikka, P., & Lehman, G. (2015). The supply-side of corruption and limits to preventing corruption within government procurement and constructing ethical subjects. Critical Perspectives on Accounting, 28(2), 62-70.
 
49.
Sohail, M., & Cavill, S. (2008). Accountability to prevent corruption in construction projects. Journal of Construction Engineering and Management, 134(9), 729-738.
 
50.
Tabish, S. Z. S., & Jha, K. N. (2012). The impact of anti-corruption strategies on corruption free performance in public construction projects. Construction Management and Economics, 30(1), 21-35.
 
51.
Thiel, S. E. (1988). Multidimensional auctions. Economics Letters, 28(1), 37-40.
 
52.
Transparency International. (2006). Bribe Payers Index 2006. Retrieved on 20 December 2013 from http://archive.transparency.or....
 
53.
Transparency International. (2008). Bribe Payers Index 2008. Retrieved on 20 December 2013 from http://archive.transparency.or....
 
54.
Transparency International. (2011). Bribe Payers Index 2011. Retrieved on 20 December 2013 from http://bpi.transparency.org/bp....
 
55.
Treisman, D. (2015). What does cross-national empirical research reveal about the causes of corruption? In P. Heywood (Ed.), Routledge handbook of political corruption (pp. 95-109). London and New York: Routledge.
 
56.
Tromme, M. (2016). Corruption and corruption research in Vietnam - an overview. Crime, Law and Social Change, 3, 1-20.
 
57.
Tu, J. C., Tu, Y. W., & Jhangr, Y. S. (2016). Analyzing Key Success Factors of Green Brands for Enterprises in Taiwan. Eurasia Journal of Mathematics, Science & Technology Education, 12(5), 1327-1346.
 
58.
Wang, H. (2016). Optimal implicit collusion in repeated procurement auctions. Journal of Economics, 117(3), 259-284.
 
59.
Wang, Y. P. (2016). A Study on Kinmen Resident’s Perception of Tourism Development and Culture Heritage Impact. Eurasia Journal of Mathematics, Science & Technology Education, 12(12), 2909-2920.
 
60.
Xueguang, Z., et al. (2011). Game analysis based on multi-attribute reverse auction. Journal of Management Engineering, 25(2), 200-205.
 
61.
Yahui, S., & Yuqiang, F. (2010). Multi-attribute sealed auction model and the optimal bidding strategy. Theory and Practice of System Engineering, 30(7), 1185-1189.
 
eISSN:1305-8223
ISSN:1305-8215
Journals System - logo
Scroll to top