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A Note on the Comparative Statics of Optimal Procurement Auctions

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  • Gonzalo Cisternas
  • Nicolás Figueroa

Abstract

We find a necessary and sufficient condition such that a distributional upgrade on a seller’s cost implies a lower expected procurement cost for a buyer. We also show that even under the strongest assumption about this upgrade made in the literature so far, the seller can be worse off, even if this upgrade is costless.

Suggested Citation

  • Gonzalo Cisternas & Nicolás Figueroa, 2007. "A Note on the Comparative Statics of Optimal Procurement Auctions," Documentos de Trabajo 240, Centro de Economía Aplicada, Universidad de Chile.
    • Handle: RePEc:edj:ceauch:240
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    References listed on IDEAS

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    1. Roger B. Myerson, 1981. "Optimal Auction Design," Mathematics of Operations Research, INFORMS, vol. 6(1), pages 58-73, February.
    2. Gonzalo Cisternas & Nicolás Figueroa, 2015. "Sequential procurement auctions and their effect on investment decisions," RAND Journal of Economics, RAND Corporation, vol. 46(4), pages 824-843, October.
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