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All-pay auctions with affiliated binary signals

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  • Chi, Chang Koo
  • Murto, Pauli
  • Välimäki, Juuso

Abstract

We analyze all-pay auctions with affiliated values and binary signals. We analyze the unique symmetric equilibrium with any number of bidders and show that the bidders earn positive rents only if the equilibrium is monotone. We also characterize the symmetric equilibrium of the closely related two-player war of attrition.

Suggested Citation

  • Chi, Chang Koo & Murto, Pauli & Välimäki, Juuso, 2019. "All-pay auctions with affiliated binary signals," Journal of Economic Theory, Elsevier, vol. 179(C), pages 99-130.
    • Handle: RePEc:eee:jetheo:v:179:y:2019:i:c:p:99-130
    DOI: 10.1016/j.jet.2018.10.010
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    References listed on IDEAS

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    Cited by:

    1. Shanglyu Deng & Hanming Fang & Qiang Fu & Zenan Wu, 2023. "Information Favoritism and Scoring Bias in Contests," PIER Working Paper Archive 23-002, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    2. Chen, Zhuoqiong, 2021. "Optimal information exchange in contests," Journal of Mathematical Economics, Elsevier, vol. 96(C).
    3. Zhuoqiong Chen, 2021. "All-pay auctions with private signals about opponents’ values," Review of Economic Design, Springer;Society for Economic Design, vol. 25(1), pages 33-64, June.
    4. Anastasia Antsygina & Mariya Teteryatnikova, 2023. "Optimal information disclosure in contests with stochastic prize valuations," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 75(3), pages 743-780, April.

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    More about this item

    Keywords

    All-pay auctions; War of attrition; Common values; Affiliated signals;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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