procurement

The paper considers the impact of the duration of competitive bidding on the organizer's payoff.  Extending the duration of the bidding process has a two-fold effect on its results.  On the one hand, it attracts a larger number of bidders, and competition between them leads to the better price for the auctioneer.  On the other hand, such prolongation delays the receipt of money or necessary supplies, and time has value in itself.  These two conflicting factors suggest that there must be an optimal duration of the bidding process.  We propose a model that combines these