Two Topics in Mathematics and Procurement (Part 2)

Abstract

In the 1st part of the paper, I study a method of detecting anomalous bids in public procurement. I will then give a detailed treatment of principal component analysis. Next, a statistical method based on principal components to detect anomalous bids will be described. I show that under certain assumptions, this statistic follows the non- central $X2$ distribution. Finally, I give an example based on the data from a real tender to show how this statistic can detect anomalous bids. In the 2nd part, I investigate whether bidding performance of 6 companies in 5 tenders organized by 1 tendering entity is influenced by learning using random effects logistic regression.