Detecting abnormally low bids in procurement auctions is a recognized problem, since their acceptance could result in the winner not being able to provide the service or work awarded by the auction, which is a significant risk for the auctioneer. A rank-and-compare algorithm is considered to detect such anomalous bids and help auctioneers in achieving an effective rejection decision. Analytical expressions and simulation results are provided for the detection probability, as well as for the false alarm probability. The suggested range of application of the detection algorithm leaves out the cases of many tenderers (more than 20) and quite dispersed bids (coefficient of variation larger than 0.15). An increase in the number of tenderers leads to contrasting effects, since both the false alarm probability and the detection probability are reduced. If the bids are spread over a large range, we have instead a double negative effect, with more false alarms and less detections. The presence of multiple anomalous bids worsens the performance of the algorithm as well. On the other hand, the method is quite robust to the presence of courtesy bids.
A rank-and-compare algorithm to detect abnormally low bids in procurement auctions / De Giovanni, Livia; P. L., Conti; M., Naldi. - In: ELECTRONIC COMMERCE RESEARCH AND APPLICATIONS. - ISSN 1567-4223. - 11:2(2012), pp. 192-203. [10.1016/j.elerap.2011.12.008]
A rank-and-compare algorithm to detect abnormally low bids in procurement auctions
DE GIOVANNI, LIVIA;
2012
Abstract
Detecting abnormally low bids in procurement auctions is a recognized problem, since their acceptance could result in the winner not being able to provide the service or work awarded by the auction, which is a significant risk for the auctioneer. A rank-and-compare algorithm is considered to detect such anomalous bids and help auctioneers in achieving an effective rejection decision. Analytical expressions and simulation results are provided for the detection probability, as well as for the false alarm probability. The suggested range of application of the detection algorithm leaves out the cases of many tenderers (more than 20) and quite dispersed bids (coefficient of variation larger than 0.15). An increase in the number of tenderers leads to contrasting effects, since both the false alarm probability and the detection probability are reduced. If the bids are spread over a large range, we have instead a double negative effect, with more false alarms and less detections. The presence of multiple anomalous bids worsens the performance of the algorithm as well. On the other hand, the method is quite robust to the presence of courtesy bids.File | Dimensione | Formato | |
---|---|---|---|
ECRA2012.pdf
Solo gestori archivio
Tipologia:
Documento in Post-print
Licenza:
DRM (Digital rights management) non definiti
Dimensione
659.82 kB
Formato
Adobe PDF
|
659.82 kB | Adobe PDF | Visualizza/Apri |
abstractECRA2012.pdf
Solo gestori archivio
Tipologia:
Abstract
Licenza:
DRM (Digital rights management) non definiti
Dimensione
64.8 kB
Formato
Adobe PDF
|
64.8 kB | Adobe PDF | Visualizza/Apri |
Pubblicazioni consigliate
I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.