Procurement projects often involve substantial uncertainty in inputs at the time of contracting. Whether the procurer or contractor assumes such risk depends on the specific contractual agreement. Using auction data from the Florida Department of Transportation, we document evidence of i)...

Auction data often contain information on only the most competitive bids as opposed to all bids. The usual measurement error approaches to unobserved heterogeneity are inapplicable due to dependence among order statistics. We bridge this gap by providing a set of positive results. First, we show...

We establish nonparametric identification of auction models with continuous unobserved heterogeneity using three consecutive order statistics of bids. We then propose sieve maximum likelihood estimators for estimating the unobserved heterogeneity distribution and the value distributions jointly....