Collusion in Private Value Ascending Price Auctions
AbstractWe investigate bidder collusion in one-sided ascending price auctions without communication. If bidding rules in an English-type auction allow bidders to match each others' bids, collusion can be sustained as a Nash equilibrium of a one-shot auction game. Our earlier experiments show that in common value auctions with complete information, collusion does occur and is sustainable even when bidders cannot explicitly coordinate their strategies. In this study, we investigate the robustness of bidders' collusive behaviour in private values, private information environments. We find that collusion still occurs as long as the bidders' gains from collusion are high.
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Bibliographic InfoPaper provided by The University of Melbourne in its series Department of Economics - Working Papers Series with number 707.
Length: 17 pages
Date of creation: 1999
Date of revision:
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Postal: Department of Economics, The University of Melbourne, 5th Floor, Economics and Commerce Building, Victoria, 3010, Australia
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Web page: http://www.economics.unimelb.edu.au
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AUCTIONS ; EXPERIMENTS ; COLLUSION;
Other versions of this item:
- Sherstyuk, Katerina, 2002. "Collusion in private value ascending price auctions," Journal of Economic Behavior & Organization, Elsevier, vol. 48(2), pages 177-195, June.
- Sherstyuk Katerina, 1999. "Collision in Private Value Ascending Price Auctions," Working Papers 1063, California Institute of Technology, Division of the Humanities and Social Sciences.
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
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