Present value of revenues auction

A present value of revenues auction, sometimes called a least present value of revenues auction, is a method of awarding contracts in which the bids are for the total present value of cash flows from the project. The lowest bid wins, and the winner collects user fees until the present value of user fees equals their bid.[1] This system has been proposed for private highway construction.

Part of a series on
Auctions
Auction Room, Christie's, circa 1808.
Types
Bidding
Contexts
Theory
Online

References
  1. World Bank (1997). Dealing with Public Risk in Private Infrastructure. ed. Timothy Irwin, Michael Klein, Guillermo E. Perry, and Mateen Thobani.
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