Similar to most other countries, the lowest bidder is typically the winner of construction projects in Sri Lanka. In public sector this is because of accountability and in private sector it is mostly for the cost reasons. The lowest bid may come from a firm that badly under estimates the cost of the project. Therefore, there is a possibility that large winner’s curses to exist. Winner’s curse results in lower profits (or negative profits in some cases) which is detrimental. Want to know further? Read my web article: Winner’s Curse in Construction - Evidence from Sri Lanka.
...