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Auction Design without Commitment

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  • Hannu Vartiainen

    (Department of Economics, Turku School of Economics)

Abstract

We study auction design when parties cannot commit to the mechanism. The seller may change the rules of the game any number of times and the buyers may choose their outside option at any stage of the game. A dynamic consistency condition and an optimality condition property are defined to characterize the seller's mechanism selection behavior. The unique stationary mechanism selection rule that meets the conditions is the English auction.

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Bibliographic Info

Paper provided by Aboa Centre for Economics in its series Discussion Papers with number 44.

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Length: 29
Date of creation: Mar 2009
Date of revision:
Handle: RePEc:tkk:dpaper:dp44

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Keywords: auctions; commitment; consistency; one-deviation property; stationarity;

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References

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Citations

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Cited by:
  1. Leonardo Rezende, 2009. "Biased procurement auctions," Economic Theory, Springer, vol. 38(1), pages 169-185, January.
  2. Vasiliki Skreta, 2010. "Optimal Auction Design under Non-Commitment," Levine's Working Paper Archive 506439000000000176, David K. Levine.
  3. Qingmin Liu & Konrad Mierendorff & Xianwen Shi, 2013. "Auctions with Limited Commitment," Working Papers tecipa-504, University of Toronto, Department of Economics.
  4. Chia-Hui Chen & Junichiro Ishida, 2013. "Auctions Versus Negotiations: The Role of Price Discrimination," ISER Discussion Paper 0873, Institute of Social and Economic Research, Osaka University.
  5. Lamping, Jennifer, 2008. "The Value of Commitment in Auctions with Matching," MPRA Paper 24373, University Library of Munich, Germany.
  6. Kaplan, Todd R & Zamir, Shmuel, 2014. "Advances in Auctions," MPRA Paper 54656, University Library of Munich, Germany.
  7. David McAdams & Michael Schwarz, 2007. "Credible Sales Mechanisms and Intermediaries," American Economic Review, American Economic Association, vol. 97(1), pages 260-276, March.

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