| Nowadays,procurement auction is one of the most important sourcing mechanisms,and the pervasiveness of procurement risks is pushing procurement auction research to the frontier of operations management.Procurement risks would greatly distort the bidding behavior of suppliers with private information,which poses significant impacts on the design of procurement auctions.The investigation on related managerial and scientific issues is thus of theoretical and practical importance.According to the characteristics of the objects being procured and that of the participating players,this thesis focuses on four typical procurement risks,i.e.,supply quantity uncertainty(of products),supply quality uncertainty(of services),supplier effort unverifiability,and procurement agent corruption.Under environments of above risks,several procurement auctions with risk-mitigation functions are analyzed,by incorporating common risk-mitigation strategies—including dual sourcing,incomplete contracts,renegotiation,and performance pay—into the framework of procurement auction design.The main content of research includes the following four aspects:First,in the scenario where the buyer faces supply quantity uncertainty,and suppliers possess private information about their production costs which are drawn from a publicly known distribution,the thesis analyzes the design of optimal dual-sourcing auctions where suppliers bid wholesale prices.First considering a general revenue function of the buyer,the optimal quantity allocation rule and suppliers’ bidding equilibrium are obtained.Results show that both the buyer and the suppliers are better off in the optimal dual-sourcing auction than in the optimal single-sourcing auction,and that the existence of information asymmetry benefits the winning supplier but harms the buyer and the whole supply chain.Then,focusing on the newsvendor setting and the monopoly setting,the thesis further studies the diversification degree of quantity allocation,the value of information,and the value of the dual-sourcing option.Analyses show that the higher-cost winner charges a higher per unit information rent than the lower-cost winner,and the value of the dual-sourcing option increases with the retail price and the number of bidding suppliers.Second,in a parallel scenario with the above one where the suppliers’ cost distribution is unknown,the thesis explores two prior-free auction mechanisms for dual sourcing,i.e.,the Generalized English Auction(GEA)and the two-stage Asymptotically Optimal Mechanism(AOM).In GEA,due to the lack of a pre-announced allocation rule,the lower-cost winner extracts the highest possible unit information rent at the price of losing his cost advantage in terms of quantity allocation.Consequently,two winning suppliers form a tacit collusion at the same auction price and evenly split the total order quantity,which leads the buyer to trade off collusion against mitigation in order to determine whether the dual-sourcing option is beneficial.On the basis of GEA,AOM introduces a second-stage direct mechanism design for the two winning suppliers,which cuts off the collusive bidding behavior of the first stage and implements the optimal dual-sourcing outcome under unknown distribution,by estimating the winners’ cost distributions with revealed bids information.Comparisons between GEA and AOM show that GEA with fully diversified quantity allocation may generate a higher market service level than AOM,although the buyer’s expected profit under GEA is lower.Third,in information technology service procurement with uncertain service quality and unverifiable supplier effort,the buyer’s problem of auctioning incomplete contract is investigated,considering joint efforts for quality improvement after bidding,and renegotiation of service content after quality realization.Two parallel scenarios are analyzed.In the first scenario where the buyer’s effort is verifiable and is committed before biding together with the announcement of service content,the strategic relationship between initial service content and buyer’s effort commitment is examined.Results show that the winning supplier’s effort and information rent are decreasing in the initial service content but increasing in the buyer’s effort commitment.The buyer thus should strategically use the initial service content and effort commitment,as two instruments,to balance his control over information rent and supplier effort.Further analysis indicates that the above two instruments are strategic substitutes under low supplier bargaining power and strategic complements under high supplier bargaining power.In the second scenario where the buyer’s effort is unverifiable,the Nash game regarding joint efforts after bidding and the buyer’s optimization of service content before bidding are explored.Results reveal that the efforts of the buyer and the winning supplier are strategic complements,and that higher initial service content leads to higher buyer effort,lower information rent and lower supplier effort.Last,the thesis examines procurement auctions under the risk of auctioneer(procurement agent)corruption and studies the buyer’s regulation of the corruption with a performance pay scheme.In the model,the auctioneer allows a favored bidder to submit two bids simultaneously and charges a share of the difference between two bids as bribe transfer.The suppliers’ bidding equilibrium and the impacts of the corruption on auction outcomes are firstly analyzed.Results show that the difference between the favored bidder’s two bids,the probability of corruption and the probability of allocation inefficiency are all decreasing in the bribe share,and that the corruption benefits both the auctioneer and the favored bidder but harms the ordinary bidders.Then,the thesis studies the auctioneer’s decision of the bribe share and the buyer’s regulation of the corruption.Analyses show that by driving the auctioneer to charge a higher bribe share which is less attractive for the favored bidder,severer regulation tends to reduce the probability of corruption.Extremely severe regulation can exclude the corruption and ensure allocation efficiency,but the buyer’s cost minimization objective would tolerate some degree of the corruption. |
