Menu Auctions with Non-Transferable Utilities and Budget Constraints
AbstractThis paper extends Bernheim and Whinston's (1986) menu auction model under transferable utilities to a framework with non-transferable utilities and budget constraints. Under appropriate definitions of equilibria, it is shown that every truthful Nash equilibrium (TNE) is a coalition-proof Nash equilibrium (CPNE) and that the set of TNE payoffs and the set of CPNE payoffs are equivalent, as in a transferable utility framework. The existence of a CPNE is assured in contrast with the possible non-existence of Nash equilibrium under the definition by Dixit, Grossman, and Helpman (1997). Moreover, the set of CPNE payoffs is equivalent to the bidder-optimal weak core.
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Bibliographic InfoPaper provided by Boston College Department of Economics in its series Boston College Working Papers in Economics with number 787.
Date of creation: 20 Oct 2011
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More information through EDIRC
non-transferable utility; menu auction; coalition-proof Nash equilibrium; truthful Nash equilibrium;
Find related papers by JEL classification:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D79 - Microeconomics - - Analysis of Collective Decision-Making - - - Other
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-10-22 (All new papers)
- NEP-CIS-2011-10-22 (Confederation of Independent States)
- NEP-GTH-2011-10-22 (Game Theory)
- NEP-MIC-2011-10-22 (Microeconomics)
- NEP-UPT-2011-10-22 (Utility Models & Prospect Theory)
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