Empirical Analysis of Competition in Procurement Auctions

A vast amount of public services and goods are contracted through procurement auctions. Therefore it is very important to design these auctions in an optimal way. Typically, we are interested in two different objectives. The first objective is efficiency. Efficiency means that the contract is awarded to the bidder that values it the most, which in the procurement setting means the bidder that has the lowest cost of providing a service with a given quality. The second objective is to maximize public revenue. Maximizing public revenue means minimizing the costs of procurement. Both of these goals are important from the welfare point of view. In this thesis, I analyze field data from procurement auctions and show how empirical analysis can be used to help design the auctions to maximize public revenue. In particular, I concentrate on how competition, which means the number of bidders, should be taken into account in the design of auctions. In the first chapter, the main policy question is whether the auctioneer should spend resources to induce more competition. The information paradigm is essential in analyzing the effects of competition. We talk of a private values information paradigm when the bidders know their valuations exactly. In a common value information paradigm, the information about the value of the object is dispersed among the bidders. With private values more competition always increases the public revenue but with common values the effect of competition is uncertain. I study the effects of competition in the City of Helsinki bus transit market by conducting tests for common values. I also extend an existing test by allowing bidder asymmetry. The information paradigm seems to be that of common values. The bus companies that have garages close to the contracted routes are influenced more by the common value elements than those whose garages are further away. Therefore, attracting more bidders does not necessarily lower procurement costs, and thus the City should not implement costly policies to induce more competition. In the second chapter, I ask how the auctioneer can increase its revenue by changing contract characteristics like contract sizes and durations. I find that the City of Helsinki should shorten the contract duration in the bus transit auctions because that would decrease the importance of common value components and cheaply increase entry which now would have a more beneficial impact on the public revenue. Typically, cartels decrease the public revenue in a significant way. In the third chapter, I propose a new statistical method for detecting collusion and compare it with an existing test. I argue that my test is robust to unobserved heterogeneity unlike the existing test. I apply both methods to procurement auctions that contract snow removal in schools of Helsinki. According to these tests, the bidding behavior of two of the bidders seems consistent with a contract allocation scheme.

Noviisiopettajana peruskoulussa : Aloittelevien opettajien autenttisia kokemuksia ensimmäisestä opettajavuodesta

As a Novice Teacher at Comprehensive School: The authentic experiences of the beginning teachers during their first year of teaching The aim of this study is to explicate the novice year of teaching in the light of teachers´ authentic experiences. The subject of this investigation is the teachers´ subjective world of experience during their first academic year of teaching and the sharing of these experiences in collaborative consulting meetings. The themes discussed in the meetings were introduced into the collaborative group by the novice teachers themselves, and the progress of discussion was con-trolled by them. The research data was gathered in a consultative working group where the way a novice teacher starts to interpret, analyze and identify his/her own complex and dynamic teaching situations was observed. The research data gathered in this way illuminates novice teachers´ world of experience and mental picture as well as the unconscious sides of school life. In a theoretical frame of reference, the work of a teacher is identified, according to systemic scientific thought, as a dynamic triangle in which the basic elements are the personality of the teacher, the role of the teacher and the school as an organization. These basic elements form a whole within which the teacher works. The dynamics of this triangle in a teacher’s work are brought to light through the study of the phenomena of groups and group dynamics since a teacher works either as a member of a group (working community), as a leader of a group (teaching situations) or in a network (parent – teacher cooperation). Therefore, tension and force are always present in teaching work. The main research problem was to explain how a novice teacher experiences his/her first working year as a teacher. The participants (n=5) were teaching at five different comprehensive schools in the city of Helsinki. This was their first long-term post as a teacher. The research data consists of seven collaborative consulting meetings, as well as recordings and transcripts of the meetings. A classificatory framework was developed for data analysis which enabled a sys-tematic qualitative content analysis based on theory and material. In addition to the consulting meetings, the teachers were interviewed at the beginning and at the end of the process of collecting the research material. The interviews were used to interpret the meanings of the content analysis based on raw data. The findings show that there is a gap between teacher education and the reality of school life, which causes difficulties for a novice teacher during his/her first teaching year. The gap is rather a global educational problem than a national one, and therefore it is independent of cultural factors. Novice teachers desire a well-structured theory of teacher education and a clear programme where the themes and content delve deeper and deeper into the subject matter during the study years. According to the novice teachers, teacher education frequently consists of sporadic and unconnected study and class situations. An individual content weakness of teacher education is the lack of insufficient initiation into evaluation processes. The novice teachers suggest that a student must be provided good-quality and competent guidance during the study years and during his or her induction. There should be a well-organized, structured and systematic induction program for novice teachers. The induction program should be overseen by an organization so that the requirements of a qualified induction can be met. The findings show that the novice teachers find the first year of teaching at comprehensive school emotionally loaded. The teachers experienced teaching as difficult work and found the workload heavy. Nevertheless, they enjoyed their job because, as they said, there were more pleasant than unpleasant things in their school day. Their main feeling at school was the joy of success in teaching. The novice teachers felt satisfaction with their pupils. The teachers experienced the more serious feelings of anger and disgust when serious violence took place. The most difficult situations arose from teaching pupils who had mental health problems. The toughest thing in the teacher´s work was teaching groups that are too heterogeneous. The most awkward problems in group dynamics happened when new immigrants, who spoke only their own languages, were integrated into the groups in the middle of the school year. Teachers wanted to help children who needed special help with learning but restated at the same time that the groups being taught shouldn’t be too heterogeneous. The teachers wished for help from school assistants so that they could personally concentrate more on teaching. Not all the parents took care of their children according to the comprehensive school law. The teachers found it hard to build a confidential relationship between home and school. In this study, novice teachers found it hard to join the teaching staff at school. Some of the teachers on staff were very strong and impulsive, reacting loudly and emotionally. These teachers provoked disagreement, conflicts, power struggles and competition among the other teachers. Although the novice teachers of the study were all qualified teachers, three of them were not interested in a permanent teaching job. For these teachers teaching at a primary school was just a project, a short period in their working life. They will remain in the teaching profession as long as they are learning new things and enjoying their teaching job. This study is an independent part of the research project on Interplay – Connecting Academic Teacher Education and Work, undertaken by the Department of Applied Sciences of Education at the University of Helsinki. Key words: novice teacher, emotions, groups and group dynamics, authority, co-operation between home and school, teacher community, leadership at school, induction, consulting

Routine Measurement of Health-Related Quality of Life in Assessing Cost-Effectiveness in Secondary Health Care

Aims: The aims of this study were 1) to identify and describe health economic studies that have used quality-adjusted life years (QALYs) based on actual measurements of patients' health-related quality of life (HRQoL); 2) to test the feasibility of routine collection of health-related quality of life (HRQoL) data as an indicator of effectiveness of secondary health care; and 3) to establish and compare the cost-utility of three large-volume surgical procedures in a real-world setting in the Helsinki University Central Hospital, a large referral hospital providing secondary and tertiary health-care services for a population of approximately 1.4 million. Patients and methods: So as to identify studies that have used QALYs as an outcome measure, a systematic search of the literature was performed using the Medline, Embase, CINAHL, SCI and Cochrane Library electronic databases. Initial screening of the identified articles involved two reviewers independently reading the abstracts; the full-text articles were also evaluated independently by two reviewers, with a third reviewer used in cases where the two reviewers could not agree a consensus on which articles should be included. The feasibility of routinely evaluating the cost-effectiveness of secondary health care was tested by setting up a system for collecting HRQoL data on approximately 4 900 patients' HRQoL before and after operative treatments performed in the hospital. The HRQoL data used as an indicator of treatment effectiveness was combined with diagnostic and financial indicators routinely collected in the hospital. To compare the cost-effectiveness of three surgical interventions, 712 patients admitted for routine operative treatment completed the 15D HRQoL questionnaire before and also 3-12 months after the operation. QALYs were calculated using the obtained utility data and expected remaining life years of the patients. Direct hospital costs were obtained from the clinical patient administration database of the hospital and a cost-utility analysis was performed from the perspective of the provider of secondary health care services. Main results: The systematic review (Study I) showed that although QALYs gained are considered an important measure of the effectiveness of health care, the number of studies in which QALYs are based on actual measurements of patients' HRQoL is still fairly limited. Of the reviewed full-text articles, only 70 reported QALYs based on actual before after measurements using a valid HRQoL instrument. Collection of simple cost-effectiveness data in secondary health care is feasible and could easily be expanded and performed on a routine basis (Study II). It allows meaningful comparisons between various treatments and provides a means for allocating limited health care resources. The cost per QALY gained was 2 770 for cervical operations and 1 740 for lumbar operations. In cases where surgery was delayed the cost per QALY was doubled (Study III). The cost per QALY ranges between subgroups in cataract surgery (Study IV). The cost per QALY gained was 5 130 for patients having both eyes operated on and 8 210 for patients with only one eye operated on during the 6-month follow-up. In patients whose first eye had been operated on previous to the study period, the mean HRQoL deteriorated after surgery, thus precluding the establishment of the cost per QALY. In arthroplasty patients (Study V) the mean cost per QALY gained in a one-year period was 6 710 for primary hip replacement, 52 270 for revision hip replacement, and 14 000 for primary knee replacement. Conclusions: Although the importance of cost-utility analyses has during recent years been stressed, there are only a limited number of studies in which the evaluation is based on patients own assessment of the treatment effectiveness. Most of the cost-effectiveness and cost-utility analyses are based on modeling that employs expert opinion regarding the outcome of treatment, not on patient-derived assessments. Routine collection of effectiveness information from patients entering treatment in secondary health care turned out to be easy enough and did not, for instance, require additional personnel on the wards in which the study was executed. The mean patient response rate was more than 70 %, suggesting that patients were happy to participate and appreciated the fact that the hospital showed an interest in their well-being even after the actual treatment episode had ended. Spinal surgery leads to a statistically significant and clinically important improvement in HRQoL. The cost per QALY gained was reasonable, at less than half of that observed for instance for hip replacement surgery. However, prolonged waiting for an operation approximately doubled the cost per QALY gained from the surgical intervention. The mean utility gain following routine cataract surgery in a real world setting was relatively small and confined mostly to patients who had had both eyes operated on. The cost of cataract surgery per QALY gained was higher than previously reported and was associated with considerable degree of uncertainty. Hip and knee replacement both improve HRQoL. The cost per QALY gained from knee replacement is two-fold compared to hip replacement. Cost-utility results from the three studied specialties showed that there is great variation in the cost-utility of surgical interventions performed in a real-world setting even when only common, widely accepted interventions are considered. However, the cost per QALY of all the studied interventions, except for revision hip arthroplasty, was well below 50 000, this figure being sometimes cited in the literature as a threshold level for the cost-effectiveness of an intervention. Based on the present study it may be concluded that routine evaluation of the cost-utility of secondary health care is feasible and produces information essential for a rational and balanced allocation of scarce health care resources.

Quality Assessment of a Forest Inventory Based on Airborne Laser Scanning

In this study, a quality assessment method based on sampling of primary laser inventory units (microsegments) was analysed. The accuracy of a laser inventory carried out in Kuhmo was analysed as a case study. Field sample plots were measured on the sampled microsegments in the Kuhmo inventory area. Two main questions were considered. Did the ALS based inventory meet the accuracy requirements set for the provider and how should a reliable, cost-efficient and independent quality assessment be undertaken. The agreement between control measurement and ALS based inventory was analysed in four ways: 1) The root mean squared errors (RMSEs) and bias were calculated. 2) Scatter plots with 95% confidence intervals were plotted and the placing of identity lines was checked. 3) Bland-Altman plots were drawn so that the mean difference of attributes between the control method and ALS-method was calculated and plotted against average value of attributes. 4) The tolerance limits were defined and combined with Bland-Altman plots. The RMSE values were compared to a reference study from which the accuracy requirements had been set to the service provider. The accuracy requirements in Kuhmo were achieved, however comparison of RMSE values proved to be difficult. Field control measurements are costly and time-consuming, but they are considered to be robust. However, control measurements might include errors, which are difficult to take into account. Using the Bland-Altman plots none of the compared methods are considered to be completely exact, so this offers a fair way to interpret results of assessment. The tolerance limits to be set on order combined with Bland-Altman plots were suggested to be taken in practise. In addition, bias should be calculated for total area. Some other approaches for quality control were briefly examined. No method was found to fulfil all the required demands of statistical reliability, cost-efficiency, time efficiency, simplicity and speed of implementation. Some benefits and shortcomings of the studied methods were discussed.

Selenium and its effects on growth, yield and tuber quality in potato

Selenium (Se) has been demonstrated to be an essential trace element for maintenance of animal and human health. Although it has not been confirmed to be an essential micronutrient in higher plants, there is increasing evidence that Se functions as an antioxidant in plants. Selenium has been shown to exert a beneficial effect on crop growth and promotes stress tolerance at low concentrations. However, the specific physiological mechanisms that underlie the positive effects of Se in plants have not been clearly elucidated. The aims of this study were to determine the Se concentration in potato (Solanum tuberosum L.) and the effects of Se on the accumulation of carbohydrates, growth and yield in potato plants. An additional aim was to study the impact of Se on the total glycoalkaloid concentration in immature potato tubers. The distribution of Se in different biochemical Se fractions and the effect of storage on the Se concentration were studied in Se-enriched tubers. Furthermore, the effect of Se on raw darkening and translocation of Se from seed tubers to the next tuber generation was investigated. Due to the established anti-ageing properties of Se, it was of interest to study if Se affects physiological age and growth vigour of seed tubers. The Se concentrations in the upper leaves, roots, stolons and tubers of potato increased with increasing Se supplementation. The highest Se concentration was reached in young upper leaves, roots and stolons, indicating that added selenate was efficiently utilized and taken up at an early stage. During the growing period the Se concentration declined in the aerial parts, roots and stolons of potato plants whereas an intensive accumulation took place in immature and mature tubers. Selenium increased carbohydrate accumulation in the young upper leaves and in stolons, roots and tubers at maturity. This could not be explained by increased production of photoassimilates as net photosynthesis did not differ among Se treatments. The Se treated plants produced higher tuber yields than control plants, and at the highest Se concentration (0.3 mg kg-1) lower numbers of larger tubers were harvested. Increased yield of Se treated plants suggested that Se may enhance the allocation of photoassimilates for tuber growth, acting as a strong sink for both Se and for carbohydrates. Similarly as for other plant species, the positive impact of Se on the yield of potato plants could be related to its antioxidative effect in delaying senescence. The highest Se supplementation (0.9 mg kg-1) slightly decreased the glycoalkaloid concentration of immature tubers. However, at this level the Se concentration in tubers was about 20 µg g-1 DW. A 100 g consumption of potato would provide about 500 mg of Se, which exceeds the upper safe intake level of 400 µg per day for human dietary. The low Se applications (0.0035 and 0.1 mg kg-1) diminished and retarded the degree of raw darkening in tubers stored for one and eight months, which can be attributed to the antioxidative properties of Se. The storage for 1 to 12 months did not affect the Se concentrations of tubers. In the Se enriched tubers Se was allocated to the organic Se fraction, indicating that it was incorporated into organic compounds in tubers. Elevated Se concentration in the next-generation tubers produced by the Se enriched seed tubers indicated that Se could be translocated from the seed tubers to the progeny. In the seed tubers stored for 8 months, at high levels, Se had some positive effects on the growth vigour of sprouts, but Se had no consistent effect on the growth vigour of seed tubers of optimal physiological age. These results indicate that Se is a beneficial trace element in potato plants that exerts a positive effect on yield formation and improves the processing and storage quality of table potato tubers. These positive effects of Se are, however, dependent on the Se concentration and the age of the potato plant and tuber.