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A Learning Approach to Auctions

  • Hon-Snir, Shlomit
  • Monderer, Dov
  • Sela, Aner

We analyze a repeated first-price auction in which the types of the players are determined before the first round. It is proved that if every player is using either a belief-based learning scheme with bounded recall or a generalized fictitious play learning scheme, then for sufficiently large time, the players' bids are in equilibrium in the one-shot auction in which the types are commonly known.

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Article provided by Elsevier in its journal Journal of Economic Theory.

Volume (Year): 82 (1998)
Issue (Month): 1 (September)
Pages: 65-88

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Handle: RePEc:eee:jetheo:v:82:y:1998:i:1:p:65-88
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622869

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  14. Wilson, Robert, 1992. "Strategic analysis of auctions," Handbook of Game Theory with Economic Applications, in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 1, chapter 8, pages 227-279 Elsevier.
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  17. Marx, Leslie M. & Swinkels, Jeroen M., 1997. "Order Independence for Iterated Weak Dominance," Games and Economic Behavior, Elsevier, vol. 18(2), pages 219-245, February.
  18. Bikhchandani, Sushil, 1988. "Reputation in repeated second-price auctions," Journal of Economic Theory, Elsevier, vol. 46(1), pages 97-119, October.
  19. Monderer, Dov & Shapley, Lloyd S., 1996. "Fictitious Play Property for Games with Identical Interests," Journal of Economic Theory, Elsevier, vol. 68(1), pages 258-265, January.
  20. J. Robinson, 1969. "An Iterative Method of Solving a Game," Levine's Working Paper Archive 422, David K. Levine.
  21. Thorlund-Petersen, Lars, 1990. "Iterative computation of cournot equilibrium," Games and Economic Behavior, Elsevier, vol. 2(1), pages 61-75, March.
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