The Vulnerability of Auctions to Bidder Collusion
AbstractPrevious work has addressed the relative vulnerability of different auction schemes to collusive bidding. The common wisdom is that ascending-bid and second-price auctions are highly susceptible to collusion. We show that the details of ascending-bid and second-price auctions, including bidder registration procedures and procedures for information revelation during the auction, can be designed to completely inhibit, or unintentionally facilitate, certain types of collusion. If auctions are designed without acknowledging the possibility of collusion then the design will ignore key features that impact the potential success of colluding bidders. (c) 2009 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology..
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Bibliographic InfoArticle provided by MIT Press in its journal Quarterly Journal of Economics.
Volume (Year): 124 (2009)
Issue (Month): 2 (May)
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- Giuseppe Lopomo & Leslie M. Marx & David McAdams & Brian Murray, 2011. "Carbon Allowance Auction Design: An Assessment of Options for the United States," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 5(1), pages 25-43, Winter.
- Gregory Pavlov, 2013. "Correlated Equilibria and Communication Equilibria in All-pay Auctions," UWO Department of Economics Working Papers 20132, University of Western Ontario, Department of Economics.
- David McAdams & Giuseppe Lopomo & Leslie Marx & Brian Murray, . "Carbon Allowance Auction Design: An Assessment of Options for the U.S," Working Papers 10-64, Duke University, Department of Economics.
- Stéphane Saussier & Carine Staropoli & Anne Yvrande-Billon, 2009. "Public–Private Agreements, Institutions, and Competition: When Economic Theory Meets Facts," Review of Industrial Organization, Springer, vol. 35(1), pages 1-18, September.
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