Protection in government procurement auctions

Matthew T. Cole, Ronald B. Davies, Todd Kaplan

Research output: Contribution to journalArticlepeer-review


Discrimination against foreign bidders in procurement auctions has typically been achieved by price preferences. We demonstrate that in the bidding game, each level of protection via a price preference can be achieved by an equivalent tariff. When government welfare depends only on net expenditures, this equivalence carries over to the government's decision. As such, this equivalence provides a justification that agreements to eliminate price preferences to be taken in tandem with agreements to lower tariffs; e.g., the Government Procurement Agreement (GPA) in the broader context of the WTO.

Original languageEnglish
Pages (from-to)134-142
Number of pages9
JournalJournal of International Economics
StatePublished - 1 May 2017

Bibliographical note

Publisher Copyright:
© 2017 Elsevier B.V.


  • Government procurement
  • Price preference
  • Tariffs

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics


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