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In my experience government either choses cheapest contractor (will all sort of consequences you can imagine) or bribes are involved (which might lead to a bett

In my experience government either choses cheapest contractor (will all sort of consequences you can imagine) or bribes are involved (which might lead to a better outcome, surprisingly, but at much higher expenses). I wonder how Switzerland manages to avoid that plague.

throwaway8451 5y ago
I think that I once heard that in Switzerland the second cheapest bidder is the one to get the contract, exactly to discourage someone aggressively underbidding all others. I could not verify that now though.
- blocked_again 5y ago
  What is the right solution here from a game theory perspective?
  - bhaak 5y ago
    Own two companies that agressively underbid all others?
    - xcambar 5y ago
      That is deceptively simple. It might just work :D
  - z77dj3kl 5y ago
    Auction design is a very active research area and what the "right solution" is, is not so easy to figure out. This has huge applications in... adtech.