Quotation Gugler, Klaus, Weichselbaumer, Michael, Zulehner, Christine. 2015. Competition in the economic crisis: Analysis of procurement auctions. European Economic Review 73, 35-57.




We study the effects of the recent economic crisis on firms׳ bidding behavior and markups in sealed bid auctions. Using data from Austrian construction procurements, we estimate bidders׳ construction costs within a private value auction model. We find that markups of all bids submitted decrease by 1.5 percentage points in the recent economic crisis, markups of winning bids decrease by 3.3 percentage points. We also find that without the government stimulus package this decrease would have been larger. These two pieces of evidence point to pro-cyclical markups.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Journal article
Journal European Economic Review
Citation Index SSCI
WU Journalrating 2009 A
WU-Journal-Rating new FIN-A, VW-A, WH-B
Language English
Title Competition in the economic crisis: Analysis of procurement auctions
Volume 73
Year 2015
Page from 35
Page to 57
Reviewed? Y
DOI http://dx.doi.org/10.1016/j.euroecorev.2014.10.007


Gugler, Klaus (Details)
Weichselbaumer, Michael (Details)
Zulehner, Christine (Goethe-Universität Frankfurt, Germany)
Research Institute for Regulatory Economics FI (Details)
Department of Economics (Gugler) (Details)
Research areas (ÖSTAT Classification 'Statistik Austria')
5370 Industrial economics (Details)
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