Multi-unit auctions with private information: an indivisible unit continuous price model
AbstractWe construct a model of multi-unit auctions in which I bidders bid for two indivisible units of a common value good. Using a first-order approach, we find that there are equilibria in which bidders bid the same price for both units in the discriminatory auction, but not in the uniform auction. When there are only two bidders, under certain conditions, there are linear equilibria for both the discriminatory and the uniform auction formats. In all equilibria, bidders equalize the expected marginal benefit of bidding to the marginal costs of bidding. We show that comparison of the seller’s expected revenue across auction formats depends only on the ratio of the precision of private information to the precision of public information. Copyright Springer-Verlag 2012
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Bibliographic InfoArticle provided by Springer in its journal Economic Theory.
Volume (Year): 51 (2012)
Issue (Month): 1 (September)
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Find related papers by JEL classification:
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
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- Indranil Chakraborty, 2006. "Characterization of equilibrium in pay-as-bid auctions for multiple units," Economic Theory, Springer, vol. 29(1), pages 197-211, September.
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- Noussair, C.N., 1995.
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Open Access publications from Tilburg University
urn:nbn:nl:ui:12-381122, Tilburg University.
- Noussair, Charles, 1995. "Equilibria in a Multi-object Uniform Price Sealed Bid Auction with Multi-unit Demands," Economic Theory, Springer, vol. 5(2), pages 337-51, March.
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- Francisco Alvarez & Francisco J. André, 2013. "Auctioning vs. Grandfathering in Cap-and-Trade Systems with Market Power and Incomplete Information," Working Papers 2013.98, Fondazione Eni Enrico Mattei.
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