Incentives versus Transaction Costs: A Theory of Procurement Contracts

By Pat Bajari, S. Tadelis. 2001

1,210 citations recorded by the source corpus.

Subfields: Economics and Econometrics, Management Science and Operations Research, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/5dd6ad6bf8dffe745d72cb92d63e5b3a39d0cf63

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Citations in the corpus

Procurement When Price and Quality Matter (2010, background): “…2004), the impact of the potential non-contractability of quality (Klein and Leffler, 1981; Taylor, 1993; Manelli and Vincent, 1995; Morand and Thomas, 2002; Che and Gale, 2003), and the impact of moral hazard and renegotiation (Bajari and Tadelis, 2001, Bajari, McMillan and Tadelis, 2004).”
Adaptation and Vertical Integration in the Airline Industry (2009, background): “However, having the rights to order 12 Patrick Bajari and Tadelis (2001) endogenize the level of contractual incompleteness, showing that it may be desirable not to specify complex decisions ex ante in order to preserve flexibility and reduce the costs of ex post negotiations.”
Procurement effects on trust and control in client-contractor relationships (2007, background): “Reimbursement compensation, preferably coupled with incentives, should thus create a better basis for adaptation, suitable in complex and uncertain projects (Bajari and Tadelis, 2001).”
Active and Passive Waste in Government Spending: Evidence from a Policy Experiment (2009, neutral): “Finally we include all variables together in Column 4.”
Transacting under a performance-based contract: The role of negotiation and competitive tendering (2008, background): “Bajari and Tadelis (2001) derive three properties of g(Υ,T):”
Outsourcing of innovation (2009, neutral): “Using (4), we totally differentiate V (m,μ) = V0 with respect to m and μ.”
Four formal(izable) theories of the firm (2005, background): “More recently, formal models closer to the contract tradition have been developed by Bajari and Tadelis (2001), Tadelis (2002), and Levin and Tadelis (2004).”
The Theory of the Firm as Governance Structure: From Choice to Contract (2002, background): “Awaiting further developments, the satisficing approach is not broadly applicable (Aumann, 1985, p. 35).”
The Effect of Repeated Interaction on Contract Choice: Evidence from Offshore Drilling (2004, background): “In a more formal model, Bajari and Tadelis (2001) show why contract completeness and strong incentives go together and suggest a number of reasons why optimal contracts for various projects may tend to fall into the dichotomous categories of ®xedprice and cost-plus as they do in a wide range of…”
Bidding for Incomplete Contracts: An Empirical Analysis of Adaptation Costs (2014, methodology): “For example, in column IV of Table 11, the coe¢ cient on DEDUCT (n) is 1:18 which implies for our model that D = 0:18: As (22)Recall that the RHS of (7) includes the payment X once as a payment, and then deducts X as the adaptation costs.”
The Economics of Governance (2005, positive): “…the relevant action resides in the ex post contract implementation stage, I find the formal models and related empirical research by Steven Tadelis and his co-authors to be especially promising (Bajari and Tadelis, 2001; Tadelis, 2002; Bajari, McMillan, and Tadelis, 2004; Levin and Tadelis, 2004).”
Self-Enforcing Agreements and Relational Contracting: Evidence from California Highway Procurement (2013, background): “Examples of the latter are Bajari and Tadelis(2001, 2006), Bajari, McMillan and Tadelis(2009), andBajari and Lewis(2009), who examine theoretically and empirically procurement in the construction industry.”