Application of the Bid Amount Model to Cost Estimation Systems for Public Works

摘要

When government and local agencies order public works, contract officials are mandated to set a threshold price, which is the upper limit of the bidding price for each project, in Japan. We have developed and maintained "a cost estimation system" which computes the threshold price. In this paper, we present a model analysis using the game theory on the basis of micro-economy. The model to examine is based on an auction theory which was developed considering game theory as a basis. We employed "first-price sealed-bid auction". It turned out that it is effective to support bidding and contract procedures complete smoothly, to add the data and logic on which the production cost of a tender company.