Procurement auctions are widely used to solicit bids for custom items suchas services, construction projects, public … infrastructure, and more. Such auctions involve significant risk because the idiosyncratic nature of the purchases means that … supplier's unobservable effort. Our setting is a multi-attribute auction in which the buyer first awards a contract to the …

Procurement auctions are sometimes plagued with a chosen supplier's failing to accomplish a project successfully. The … risk of project failure is considerable, especially when the buyer has inadequate information about suppliers ex ante and … the project can only be evaluated at the end. To manage such uncertainty, a model of competitive procurement and …