Qualifying Faults - The Role of Professionalism and Accountability in Bidding Procedures

Competitive Bidding is the most common method used by organizations and governments to receive bids from prospective suppliers. Although the method is designed to ensure objectivity when considering proposals, here we suggest that it may be biased in favor of lower priced bids, a phenomenon termed lower bid bias (LBB). Importantly, we demonstrate that this bias leads people to qualify and choose bids that are faulty and should be outright rejected. We also provide insights into cognitive and attentional mechanisms underlying the bias, suggesting that it stems from intuitive information processing. This notion is supported by demonstrating that professionalism and process accountability moderate the bias, and by results we obtain when using eye-tracking methodology.