The English auction is susceptible to tacit collusion when post-auction interbidder resale is allowed. We show this by constructing equilibria where, with positive probability, one bidder wins the auction without any competition and divides the spoils by optimally reselling the good to the other bidders. These equilibria interim Pareto-dominate (among bidders) the standard value-bidding equilibrium without requiring the bidders to make any commitment on bidding behavior or postbidding spoil division. Copyright 2009 The Econometric Society.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Publisher Info
Article provided by Econometric Society in its journal Econometrica.
Volume (Year): 77 (2009) Issue (Month): 4 (07) Pages: 1095-1136 Download reference. The following formats are available: HTML
(with abstract),
plain text
(with abstract),
BibTeX,
RIS (EndNote, RefMan, ProCite),
ReDIF
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Gale, Ian L & Hausch, Donald B & Stegeman, Mark, 2000.
"Sequential Procurement with Subcontracting,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(4), pages 989-1020, November.
Rod Garratt & Thomas Tröger, 2005.
"Speculation in Standard Auctions with Resale,"
Discussion Papers
42, SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
[Downloadable!]
Giacomo Calzolari & Alessandro Pavan, 2004.
"Monopoly with Resale,"
Discussion Papers
1393, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
[Downloadable!]
Giacomo Calzolari & Alessandro Pavan, 2005.
"Monopoly with Resale,"
Discussion Papers
1405, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
[Downloadable!]
Giacomo Calzolari & Alessandro Pavan, 2003.
"Monopoly with Resale,"
Working Papers
2003.20, Fondazione Eni Enrico Mattei.
[Downloadable!]
McAfee, R Preston & McMillan, John, 1992.
"Bidding Rings,"
American Economic Review,
American Economic Association, vol. 82(3), pages 579-99, June.
[Downloadable!] (restricted)
Other versions:
McAfee, R. Preston & McMillan, John., 1990.
"Bidding Rings,"
Working Papers
726, California Institute of Technology, Division of the Humanities and Social Sciences.
[Downloadable!]
Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)