Standard Deviation of Bids for Construction Contract Auctions

[EN] Previous research has confirmed that the distribution of bids for construction auctions can be reasonably modeled with Lognormal distribution. The location parameter of this distribution (the mean mu) has been found to have a good linear correlation with the bidders' cost estimates. Ho...

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Autores: Ballesteros-Pérez, Pablo|||0000-0002-4629-9664, González-Cruz, María-Carmen|||0000-0002-6987-5732, Skitmore, Martin, Cerezo-Narváez, Alberto, Pastor-Fernández, Andrés, Otero-Mateo, Manuel
Tipo de recurso: artículo
Fecha de publicación:2021
País:España
Institución:Universitat Politècnica de València (UPV)
Repositorio:RiuNet. Repositorio Institucional de la Universitat Politécnica de Valéncia
Idioma:inglés
OAI Identifier:oai:riunet.upv.es:10251/180324
Acceso en línea:https://riunet.upv.es/handle/10251/180324
Access Level:acceso abierto
Palabra clave:Construction contracts
Auctions
Bids
Tendering
Dispersion
Bid modelling
Bid forecasting
PROYECTOS DE INGENIERIA
10.- Reducir las desigualdades entre países y dentro de ellos
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spelling Standard Deviation of Bids for Construction Contract AuctionsBallesteros-Pérez, Pablo|||0000-0002-4629-9664González-Cruz, María-Carmen|||0000-0002-6987-5732Skitmore, MartinCerezo-Narváez, AlbertoPastor-Fernández, AndrésOtero-Mateo, ManuelConstruction contractsAuctionsBidsTenderingDispersionBid modellingBid forecastingPROYECTOS DE INGENIERIA10.- Reducir las desigualdades entre países y dentro de ellos[EN] Previous research has confirmed that the distribution of bids for construction auctions can be reasonably modeled with Lognormal distribution. The location parameter of this distribution (the mean mu) has been found to have a good linear correlation with the bidders' cost estimates. However, the scale parameter (standard deviation of the bids, sigma) remains noticeably difficult to anticipate. By analyzing 13 construction auction datasets, hard evidence is provided that the high variability of sigma observed in construction auctions is mostly due to sample size (number of bids per auction). Moreover, we show that the coefficient of variation (sigma/mu) of log-transformed bids follows the same chi(2) distribution in uncapped auctions. This means the sigma's population value in similar auctions is nearly proportional to mu provided the bid price is not upper limited. Other findings are that more frequent bidders do not tend to bid lower, but their dispersion is narrower than sporadic bidders. These findings allow the introduction of important simplifications in construction bidding models, especially when access to historical data is limited.The first author acknowledges the Spanish Ministry of Science and Innovation for his Ramon y Cajal contract (RYC-2017-22222) co-funded by the European Social Fund.American Society of Civil EngineersDepartamento de Proyectos de IngenieríaEscuela Técnica Superior de Ingeniería IndustrialCentro de Investigación en Dirección de Proyectos, Innovación y Sostenibilidad (PRINS)European Social FundMinisterio de Ciencia, Innovación y UniversidadesRepositorio Institucional de la Universitat Politècnica de València Riunet20212021-08-01journal articlehttp://purl.org/coar/resource_type/c_6501VoRhttp://purl.org/coar/version/c_970fb48d4fbd8a85info:eu-repo/semantics/articleapplication/pdfapplication/pdfhttps://riunet.upv.es/handle/10251/180324reponame:RiuNet. Repositorio Institucional de la Universitat Politécnica de Valénciainstname:Universitat Politècnica de València (UPV)InglésengMinisterio de Ciencia, Innovación y Universidades https://doi.org/10.13039/100014440 RYC-2017-22222 AYUDAS RAMON Y CAJALopen accesshttp://purl.org/coar/access_right/c_abf2Reserva de todos los derechoshttp://rightsstatements.org/vocab/InC/1.0/info:eu-repo/semantics/openAccessoai:riunet.upv.es:10251/1803242026-06-13T07:49:27Z
dc.title.none.fl_str_mv Standard Deviation of Bids for Construction Contract Auctions
title Standard Deviation of Bids for Construction Contract Auctions
spellingShingle Standard Deviation of Bids for Construction Contract Auctions
Ballesteros-Pérez, Pablo|||0000-0002-4629-9664
Construction contracts
Auctions
Bids
Tendering
Dispersion
Bid modelling
Bid forecasting
PROYECTOS DE INGENIERIA
10.- Reducir las desigualdades entre países y dentro de ellos
title_short Standard Deviation of Bids for Construction Contract Auctions
title_full Standard Deviation of Bids for Construction Contract Auctions
title_fullStr Standard Deviation of Bids for Construction Contract Auctions
title_full_unstemmed Standard Deviation of Bids for Construction Contract Auctions
title_sort Standard Deviation of Bids for Construction Contract Auctions
dc.creator.none.fl_str_mv Ballesteros-Pérez, Pablo|||0000-0002-4629-9664
González-Cruz, María-Carmen|||0000-0002-6987-5732
Skitmore, Martin
Cerezo-Narváez, Alberto
Pastor-Fernández, Andrés
Otero-Mateo, Manuel
author Ballesteros-Pérez, Pablo|||0000-0002-4629-9664
author_facet Ballesteros-Pérez, Pablo|||0000-0002-4629-9664
González-Cruz, María-Carmen|||0000-0002-6987-5732
Skitmore, Martin
Cerezo-Narváez, Alberto
Pastor-Fernández, Andrés
Otero-Mateo, Manuel
author_role author
author2 González-Cruz, María-Carmen|||0000-0002-6987-5732
Skitmore, Martin
Cerezo-Narváez, Alberto
Pastor-Fernández, Andrés
Otero-Mateo, Manuel
author2_role author
author
author
author
author
dc.contributor.none.fl_str_mv Departamento de Proyectos de Ingeniería
Escuela Técnica Superior de Ingeniería Industrial
Centro de Investigación en Dirección de Proyectos, Innovación y Sostenibilidad (PRINS)
European Social Fund
Ministerio de Ciencia, Innovación y Universidades
Repositorio Institucional de la Universitat Politècnica de València Riunet
dc.subject.none.fl_str_mv Construction contracts
Auctions
Bids
Tendering
Dispersion
Bid modelling
Bid forecasting
PROYECTOS DE INGENIERIA
10.- Reducir las desigualdades entre países y dentro de ellos
topic Construction contracts
Auctions
Bids
Tendering
Dispersion
Bid modelling
Bid forecasting
PROYECTOS DE INGENIERIA
10.- Reducir las desigualdades entre países y dentro de ellos
description [EN] Previous research has confirmed that the distribution of bids for construction auctions can be reasonably modeled with Lognormal distribution. The location parameter of this distribution (the mean mu) has been found to have a good linear correlation with the bidders' cost estimates. However, the scale parameter (standard deviation of the bids, sigma) remains noticeably difficult to anticipate. By analyzing 13 construction auction datasets, hard evidence is provided that the high variability of sigma observed in construction auctions is mostly due to sample size (number of bids per auction). Moreover, we show that the coefficient of variation (sigma/mu) of log-transformed bids follows the same chi(2) distribution in uncapped auctions. This means the sigma's population value in similar auctions is nearly proportional to mu provided the bid price is not upper limited. Other findings are that more frequent bidders do not tend to bid lower, but their dispersion is narrower than sporadic bidders. These findings allow the introduction of important simplifications in construction bidding models, especially when access to historical data is limited.
publishDate 2021
dc.date.none.fl_str_mv 2021
2021-08-01
dc.type.none.fl_str_mv journal article
http://purl.org/coar/resource_type/c_6501
VoR
http://purl.org/coar/version/c_970fb48d4fbd8a85
dc.type.openaire.fl_str_mv info:eu-repo/semantics/article
format article
dc.identifier.none.fl_str_mv https://riunet.upv.es/handle/10251/180324
url https://riunet.upv.es/handle/10251/180324
dc.language.none.fl_str_mv Inglés
eng
language_invalid_str_mv Inglés
language eng
dc.relation.none.fl_str_mv Ministerio de Ciencia, Innovación y Universidades https://doi.org/10.13039/100014440 RYC-2017-22222 AYUDAS RAMON Y CAJAL
dc.rights.none.fl_str_mv open access
http://purl.org/coar/access_right/c_abf2
Reserva de todos los derechos
http://rightsstatements.org/vocab/InC/1.0/
dc.rights.openaire.fl_str_mv info:eu-repo/semantics/openAccess
rights_invalid_str_mv open access
http://purl.org/coar/access_right/c_abf2
Reserva de todos los derechos
http://rightsstatements.org/vocab/InC/1.0/
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
application/pdf
dc.publisher.none.fl_str_mv American Society of Civil Engineers
publisher.none.fl_str_mv American Society of Civil Engineers
dc.source.none.fl_str_mv reponame:RiuNet. Repositorio Institucional de la Universitat Politécnica de Valéncia
instname:Universitat Politècnica de València (UPV)
instname_str Universitat Politècnica de València (UPV)
reponame_str RiuNet. Repositorio Institucional de la Universitat Politécnica de Valéncia
collection RiuNet. Repositorio Institucional de la Universitat Politécnica de Valéncia
repository.name.fl_str_mv
repository.mail.fl_str_mv
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score 15,301603

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