Information Disclosure by a Seller in a Sequential First-Price Auction
I study a sequential first-price auction where two items are sold to two bidders with private binary valuations. A seller, prior to the second auction, can publicly disclose some information about the outcome of the first auction. I characterize equilibrium strategies for various disclosure rules when the valuations of bidders are either perfectly positively or perfectly negatively correlated across items. I establish outcome equivalence between di erent disclosure rules. I find that it is optimal for the seller to disclose some information when the valuations are negatively correlated, whereas it is optimal not to disclose any information when the valuations are positively correlated. For most of the parameter values, the seller's revenue is higher if the losing bid is disclosed. When only the winner's identity is disclosed, the equilibrium is efficient whether the valuations are positively or negatively correlated.
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- Helmuts Āzacis & Péter Vida, 2015.
"Collusive communication schemes in a first-price auction,"
Springer;Society for the Advancement of Economic Theory (SAET), vol. 58(1), pages 125-160, January.
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- Francesco Giovannoni & Miltiadis Makris, 2014. "Reputational Bidding," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 55, pages 693-710, August.
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- Yao, Zhiyong & Xiao, Zhiguo, 2013. "A note on sequential auctions with multi-unit demand," Mathematical Social Sciences, Elsevier, vol. 66(3), pages 276-281.
- Charles J. Thomas, 2010. "INFORMATION REVELATION AND BUYER PROFITS IN REPEATED PROCUREMENT COMPETITION -super-," Journal of Industrial Economics, Wiley Blackwell, vol. 58(1), pages 79-105, March. Full references (including those not matched with items on IDEAS)
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