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Efficiency of Large Double Auctions

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  • Martin W. Cripps
  • Jeroen M. Swinkels

Abstract

We consider large double auctions with private values. Values need be neither symmetric nor independent. Multiple units may be owned or desired. Participation may be stochastic. We introduce a very mild notion of "a little independence." We prove that all nontrivial equilibria of auctions that satisfy this notion are asymptotically efficient. For any alpha>0, inefficiency disappears at rate (1/n)^(2 alpha). Copyright The Econometric Society 2006.

Suggested Citation

  • Martin W. Cripps & Jeroen M. Swinkels, 2006. "Efficiency of Large Double Auctions," Econometrica, Econometric Society, vol. 74(1), pages 47-92, January.
  • Handle: RePEc:ecm:emetrp:v:74:y:2006:i:1:p:47-92
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