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Auctions with entry and resale

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  • Xu, Xiaoshu
  • Levin, Dan
  • Ye, Lixin
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Abstract

We study how resale affects auctions with costly entry in a model where bidders possess two-dimensional private information signals: entry costs and valuations. We establish the existence of symmetric entry equilibrium and identify sufficient conditions under which the equilibrium is unique. Our analysis suggests that the opportunity of resale affects both entry and bidding, and, in particular, it induces motivation for speculative entry and resale hunting abstentions. Our numerical results suggest that while expected entry is higher when resale is allowed, the effects of resale on expected revenue and efficiency are both ambiguous.

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Bibliographic Info

Article provided by Elsevier in its journal Games and Economic Behavior.

Volume (Year): 79 (2013)
Issue (Month): C ()
Pages: 92-105

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Handle: RePEc:eee:gamebe:v:79:y:2013:i:c:p:92-105

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Web page: http://www.elsevier.com/locate/inca/622836

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Keywords: Auctions; Auctions with resale; Auctions with entry;

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References

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Cited by:
  1. Todd R. Kaplan & Shmuel Zamir, 2014. "Advances in Auctions," Discussion Paper Series dp662, The Center for the Study of Rationality, Hebrew University, Jerusalem.

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