Information revelation in procurement auctions with two-sided asymmetric information
AbstractA buyer needs to procure a good from either of two potential suppliers offering differentiated products and with privately observed costs. The buyer privately observes the own valuations for the products and (ex ante) decides how much of this information should be revealed to suppliers before they play a first score auction. We show that the more significant is each supplier’s private information on the own cost, the less information the buyer should reveal. Part of our analysis is linked to the comparison between a first and a second price auction in an asymmetric setup with a distribution shift.
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Bibliographic InfoPaper provided by Universita' degli Studi di Firenze, Dipartimento di Scienze dell'Economia e Dell'Impresa in its series Working Papers Series with number wp2011_14.rdf.
Length: 42 pages
Date of creation: 2011
Date of revision:
Find related papers by JEL classification:
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-10-01 (All new papers)
- NEP-COM-2011-10-01 (Industrial Competition)
- NEP-CTA-2011-10-01 (Contract Theory & Applications)
- NEP-MIC-2011-10-01 (Microeconomics)
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