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Characterization of Bidding Behavior in Multi-Unit

Author

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  • Luciano I. De Castro

    ()

  • Alvaro Riascos

    ()

Abstract

This paper provides first order conditions for a very general class of single or multi-unit auctions. Under mild conditions we characterize bidding-behavior and generalize previous standard results in the literature. As an application we obtain sufficient conditions for truth-telling, monotonic best reply strategies and identification results for multi-unit auctions.

Suggested Citation

  • Luciano I. De Castro & Alvaro Riascos, 2007. "Characterization of Bidding Behavior in Multi-Unit," DOCUMENTOS CEDE 004382, UNIVERSIDAD DE LOS ANDES-CEDE.
  • Handle: RePEc:col:000089:004382
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    File URL: http://economia.uniandes.edu.co/publicaciones/documentocede2007-26.pdf
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    References listed on IDEAS

    as
    1. Zheng, Charles Z., 2001. "High Bids and Broke Winners," Journal of Economic Theory, Elsevier, vol. 100(1), pages 129-171, September.
    2. Robert Wilson, 1979. "Auctions of Shares," The Quarterly Journal of Economics, Oxford University Press, vol. 93(4), pages 675-689.
    3. Araujo, Aloisio & de Castro, Luciano I., 2009. "Pure strategy equilibria of single and double auctions with interdependent values," Games and Economic Behavior, Elsevier, vol. 65(1), pages 25-48, January.
    4. Krishna, Vijay & Morgan, John, 1997. "An Analysis of the War of Attrition and the All-Pay Auction," Journal of Economic Theory, Elsevier, vol. 72(2), pages 343-362, February.
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    Cited by:

    1. Jorge Balat & Juan E. Carranza & Juan D. Martin, 2015. "Dynamic and Strategic Behavior in Hydropower-Dominated Electricity Markets: Empirical Evidence for Colombia," Borradores de Economia 886, Banco de la Republica de Colombia.
    2. Araujo, Aloisio & de Castro, Luciano I., 2009. "Pure strategy equilibria of single and double auctions with interdependent values," Games and Economic Behavior, Elsevier, vol. 65(1), pages 25-48, January.
    3. Ali Hortacsu & Jakub Kastl, 2010. "Informational Advantage and Information Structure: An Analysis of Canadian Treasury Auctions," Discussion Papers 09-031, Stanford Institute for Economic Policy Research.
    4. Francisco Alvarez & Francisco J. André, 2013. "Auctioning vs. Grandfathering in Cap-and-Trade Systems with Market Power and Incomplete Information," Working Papers 2013.98, Fondazione Eni Enrico Mattei.
    5. Francisco Álvarez & Francisco André, 2015. "Auctioning Versus Grandfathering in Cap-and-Trade Systems with Market Power and Incomplete Information," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 62(4), pages 873-906, December.
    6. Alvarez, Francisco & André, Francisco J., 2015. "Auctioning emission permits in a leader-follower setting," MPRA Paper 61698, University Library of Munich, Germany.
    7. Miguel A. Espinosa & Alvaro J. Riascos Villegas, 2010. "Strategic Behaviour, Resource Valuation and Competition in Electricity Markets," DOCUMENTOS CEDE 006856, UNIVERSIDAD DE LOS ANDES-CEDE.

    More about this item

    Keywords

    Multi-unit auctions; first order conditions; truth-telling; identification; monotonic bestreply.;

    JEL classification:

    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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