The Condominium Problem; Auctions for Substitutes
AbstractThis paper considers the problem of designing selling procedures for substitutes (like condominium units). I show that oral, ascending auctions for the right to choose are efficient. This is a common type of auction used for the sale of real estate. Efficiency is not optimal from the seller's viewpoint. An optimal procedure distorts the right-to-choose auction to favor in late rounds bidders whose preferred object has already been sold. This optimal auction is complex. A revenue improving departure from efficiency can be achieved by simply auctioning all the rights to choose before any of them is exerted. This is also a common feature of auctions for the sale of real estate.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. 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.
Bibliographic InfoPaper provided by Barcelona Graduate School of Economics in its series Working Papers with number 63.
Date of creation: Jan 2003
Date of revision:
Auctions; right-to-choose; substitutes;
Other versions of this item:
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Eliaz, Kfir & Offerman, Theo & Schotter, Andrew, 2004.
"Creating Competition Out of Thin Air: Market Thickening and Right-to-Choose Auctions,"
CEPR Discussion Papers
4678, C.E.P.R. Discussion Papers.
- Kfir Eliaz, 2003. "Creating competition out of thin air: Market thickening and right-to-choose auctions," Theory workshop papers 658612000000000047, UCLA Department of Economics.
- Sarah Parlane, 2008.
"Auctioning Horizontally Differentiated Items,"
Review of Industrial Organization,
Springer, vol. 33(2), pages 113-128, September.
- repec:dgr:uvatin:2008034 is not listed on IDEAS
- Maarten C.W. Janssen & Vladimir A. Karamychev & Emiel Maasland, 2008.
"Simultaneous Pooled Auctions with Multiple Bids and Preference Lists,"
Tinbergen Institute Discussion Papers
08-034/1, Tinbergen Institute.
- Maarten C. W. Janssen & Vladimir A. Karamychev & Emiel Maasland, 2010. "Simultaneous Pooled Auctions with Multiple Bids and Preference Lists," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 166(2), pages 286-298, June.
- Ronald M. Harstad, 2007.
"Does a Seller Really Want Another Bidder?,"
0711, Department of Economics, University of Missouri.
- Burguet, Roberto, 2007.
"Right to choose in oral auctions,"
Elsevier, vol. 95(2), pages 167-173, May.
- Eliaz, Kfir & Offerman, Theo & Schotter, Andrew, 2008. "Creating competition out of thin air: An experimental study of right-to-choose auctions," Games and Economic Behavior, Elsevier, vol. 62(2), pages 383-416, March.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Bruno Guallar).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.