One policy that is believed to increase the rate of innovation and the level of productivity is to move from Design-bid-build contracts (DBB) to Design-Build contracts (DB). A common view is that the latter provides the contractor more degrees of freedom to enable innovation. This hypothesis...

This article adds to the theoretical base of unbalanced bidding in auction theory. The importance of this concept is justified by being a decisive feature in the make-or-buy decision of a client who cannot rely on repeated interaction, often the case in public procurement, for example. Earlier...

Earlier theoretical models of unbalanced bidding in unit price contracts (UPC) ofter predict corner solutions, i.e. zero bids for unit prices of expected overextimated quantities. However, anecdotal evidence indicates a lack of zero bids in the actual contracts. We pursue a possible explanation...

In this paper, we introduce a method for determining local interaction rules in animal swarms. The method is based on the assumption that the behavior of individuals in a swarm can be treated as a set of mechanistic rules.The principal idea behind the technique is to vary parameters that define...

One argument against deregulating the rental housing market is that high market rents in attractive areas would increase economic segregation. During the 1990s one major city in Sweden (Malmö) increased rents step by step in attractive areas, while another (Stockholm) did not do so. This...

Preference reversal, or choice/reservation-price inconsistency, has been documented experimentally for certain types of lotteries. We argue that the relevance of these findings for real-world markets is uncertain because the type of objects used cannot exist on a market and because the extent to...

The aim of this paper is to propose a new structure for classifying contract types and payment methods. Concerning the procurement contract types the first important feature is the stepwise structure with three main steps in the contract design: (1) should the contract only include construction...

An income tax can have side effects like decreased labor supply and lower effort levels. These side effects are important to consider in the decision of whether to introduce the tax. The terms deadweight lossand excess burdenare used by mainstream economists in this context. In this article, it...

The first aim of this paper is to clarify the meaning of moral hazard in the context of construction procurement. Two important points are that typically there is a double moral hazard problem, as the client also can “misbehave” in a number of ways, and that both internal moral hazard...