Multiple‐Winner Award Rules in Online Procurement Auctions

Qi Wang (First Author), Xuping Jiang (Participant Author), Jinhong Xie (Participant Author), Juan Feng (Participant Author)

Research output: Contribution to journalJournal


This study investigates a novel mechanism—multiple‐winner award rules—that are widely used in e‐procurement auctions and crowdsourcing sites. In many e‐procurement auctions, the auctioneer (i.e., the buyer) specifies three rules before the auction starts: (i) the size of the finalist set (from which the winner[s] will be chosen); (ii) the number of winners; and (iii) the allocation of the contract among the winners. We examine how these three rules affect auction performance using a dataset of online procurement auctions across a variety of product categories. We find that the multiple‐winner award rules significantly impact the suppliers’ participation decisions, which is an important factor in determining the economic performance of the auction (i.e., buyer's savings). Most interestingly, these three rules systematically induce opposite effects on auction participation for two types of suppliers: experienced and inexperienced bidders. For example, increasing the number of winners encourages experienced suppliers, but discourages inexperienced suppliers from participating in the auction. On the other hand, raising the disparity in the contract allocation among winning bidders (e.g., from 50/50 to 90/10 split) deters experienced suppliers, but motivates inexperienced suppliers to participate. These findings provide guidelines for industrial buyers and crowdsourcing hosts on how to effectively make use of multiple‐winner design levers to promote suppliers’ participation when designing procurement auctions and crowdsourcing contests.
Original languageEnglish
Pages (from-to)2533-2551
JournalProduction and Operations Management
Issue number10
Publication statusPublished - 2019

Corresponding author email

Project name

Hong Kong Research Grants Council

Project sponsor


Project No.



  • auction desig
  • award allocation
  • industrial procurement
  • multiple winners
  • online auctions

Indexed by

  • ABDC-A
  • Scopus


Dive into the research topics of 'Multiple‐Winner Award Rules in Online Procurement Auctions'. Together they form a unique fingerprint.

Cite this