Meanwhile, Bajari and Ye (2003) identified a set of conditions necessary for a distribution of bids to be rationalized as competitive bidding. The two main conditions are that the offers must be conditionally independent and exchangeable. Conditional independence occurs when competing firms' bids are uncorrelated after adjusting for the impact on their bids of all publicly available information such as the firm's distance from the project and the firm's access to equipment (Bajari and Ye, 2003). Without any collusion, all companies should independently arrive at their cost estimates and their bids. The companies' offers are independent of each other and therefore no correlation is detected. Exchangeability is the concept that all competing firms behave in the same way given the same cost structure for themselves and rival firms (Bajari and Ye, 2003). Businesses may vary in their behavior due to different cost structures based on their capacity and backlog and this is incorporated into the model. However, it is assumed that the costs of supplies and labor are the same. While cartel companies may reverse engineer to submit what appear to be competitive bids, many cases have shown that cartel bids fail under one or another of these conditions. The final, least emphasized condition in the study is the horse race test. This involves the verification of competitive and collusive bidding models based on their separation from the first and second conditions (Bajari and Ye, 2003). Compare the group of competitive and collusive bids for significant differences. While the work of Bajari and Ye (2003) and Padhi and Mohapatra (2011) provides an excellent basis for identifying deviations between cartel and competition… paper middle……and, colluders benefit excessively from bid rigging. For example, Bedard's company, Sintra, received $1.645 billion in government contracts while "their competitor" Construction DJL received $884 million (globalpost.com, 2014). Collusion is a pervasive problem in the U.S. government procurement auction market. The market structure has allowed collusive behavior to exist in the market. Numerous economists have developed models to detect collusion in auctions, however, differentiating between bid rigging and tacit collusion is difficult without inside information. While there are no ways to guarantee the elimination of collusion in the marketplace, some market changes, such as revealing the in-house engineer's cost estimate, can increase the competitiveness of offerings in the marketplace. There is no systematic way to detect and prevent collusion.