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What Really Matters in Auction Design

  • Paul Klemperer

The most important issues in auction design are the traditional concerns of competition policy-preventing collusive, predatory, and entry-deterring behavior. Ascending and uniform-price auctions are particularly vulnerable to these problems. The Anglo-Dutch auction - a hybrid of the sealed-bid and ascending auctions - may perform better. Effective antitrust is also critical. Notable fiascoes in auctioning mobile-phone licenses, television franchises, companies, eletricty, etc., and especially the European "third-generation" (UMTS) spectrum auctions, show that everything depends on the details of the context. Auction design is not "one size fits all."

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/0895330027166
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Article provided by American Economic Association in its journal Journal of Economic Perspectives.

Volume (Year): 16 (2002)
Issue (Month): 1 (Winter)
Pages: 169-189

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Handle: RePEc:aea:jecper:v:16:y:2002:i:1:p:169-189
Note: DOI: 10.1257/0895330027166
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