Affiliation:
1. University of Brasília, Brazil
Abstract
To understand the effects of bidder’s strategies on contractual modifications, this study utilized econometric methods and a database containing 5,434 engineering service contracts from Brazilian federal government. The results demonstrate the effects arising from the trade-off between the low prices presented in the contractor selection phase and the contractual performance measured by contract modifications. Competition among bidders in a reverse auction with multiple rounds of bid submissions can exacerbate this trade-off, potentially incentivizing risk-taking strategies by bidders. Subsequently, this may lead to the need for contract modifications to facilitate the ongoing execution of the contract.
Funder
Coordenação de Aperfeiçoamento de Pessoal de Nível Superior
Fundação de Amparo à Pesquisa do Distrito Federal – FAP/DF