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Challenges of Electronic Reverse Auctions in Construction Industry—A Review

Author

Listed:
  • Tomáš Hanák

    (Faculty of Civil Engineering, Brno University of Technology, 602 00 Brno, Czech Republic)

  • Ivan Marović

    (Faculty of Civil Engineering, University of Rijeka, HR-51000 Rijeka, Croatia)

  • Nikša Jajac

    (Faculty of Civil Engineering, Architecture and Geodesy, University of Split, HR-21000 Split, Croatia)

Abstract

The innovation of construction procurement by means of electronic reverse auctions is a controversial subject of discussion among both researchers and practitioners. This paper consolidates and critically discusses current knowledge concerning the adoption and use of electronic reverse auctions in the light of specific features of the construction industry. A systematic literature review has been employed to select papers indexed in Scopus and Web of Science databases. The findings of the study indicate that studies are addressing especially five main areas, i.e., suitability of electronic reverse auction (eRA) for construction tenders, related drivers and barriers, ethical considerations, savings potential and bidding behavior, and bid distribution. Accordingly, the authors are suggesting three directions in which future research should focus on mutual interaction of electronic reverse auctions and long-term effects on construction project outcomes.

Suggested Citation

  • Tomáš Hanák & Ivan Marović & Nikša Jajac, 2020. "Challenges of Electronic Reverse Auctions in Construction Industry—A Review," Economies, MDPI, vol. 8(1), pages 1-14, February.
    • Handle: RePEc:gam:jecomi:v:8:y:2020:i:1:p:13-:d:320816
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    References listed on IDEAS

    as
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    2. Schoenherr, Tobias & Mabert, Vincent A., 2007. "Online reverse auctions: Common myths versus evolving reality," Business Horizons, Elsevier, vol. 50(5), pages 373-384.
    3. M Skitmore, 2001. "Graphical method for identifying high outliers in construction contract auctions," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 52(7), pages 800-809, July.
    4. Pablo Ballesteros-Pérez & Martin Skitmore, 2016. "Estimating the number of new and repeated bidders in construction auctions," Construction Management and Economics, Taylor & Francis Journals, vol. 34(12), pages 919-934, December.
    5. Min-Ren Yan, 2015. "Project-Based Market Competition and Policy Implications for Sustainable Developments in Building and Construction Sectors," Sustainability, MDPI, vol. 7(11), pages 1-26, November.
    6. Mojmír Prídavok & Radoslav Delina, 2013. "Effective Spend Management Through Electronic Reverse Auction Configurations," Quality Innovation Prosperity, Technical University of Košice, Department of integrated management, vol. 17(1).
    7. Koki Arai & Emi Morimoto, 2019. "The Construction Industry and (Dis)Economies of Scope: Empirical Research in the Hokkaido Procurement Auction," Journal of Industry, Competition and Trade, Springer, vol. 19(2), pages 281-292, June.
    8. Cheng, Chi-Bin, 2011. "Reverse auction with buyer-supplier negotiation using bi-level distributed programming," European Journal of Operational Research, Elsevier, vol. 211(3), pages 601-611, June.
    9. Mohamed Charki & Emmanuel Josserand & Nabila Charki, 2011. "Toward an Ethical Understanding of the Controversial Technology of Online Reverse Auctions," Journal of Business Ethics, Springer, vol. 98(1), pages 17-37, January.
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