IDEAS home Printed from https://ideas.repec.org/p/nwu/cmsems/1321.html
   My bibliography  Save this paper

Rationalizable outcomes of large independent private-value first-price discrete auctions

Author

Listed:
  • Eddie Dekel
  • Asher Wolinsky

Abstract

We consider discrete versions of independent, private-value, first-price auctions. We show for any fixed finite set of possible bids, if the number of participants is large enough, then the set of rationalizable bids involves all players bidding the highest bid that is lower than their private value.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Eddie Dekel & Asher Wolinsky, 2001. "Rationalizable outcomes of large independent private-value first-price discrete auctions," Discussion Papers 1321, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  • Handle: RePEc:nwu:cmsems:1321
    as

    Download full text from publisher

    File URL: http://www.kellogg.northwestern.edu/research/math/papers/1321.pdf
    File Function: main text
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Kim-Sau Chung & Jeffrey C. Ely, 2019. "Efficient and Dominance Solvable Auctions with Interdependent Valuations," The Journal of Mechanism and Institution Design, Society for the Promotion of Mechanism and Institution Design, University of York, vol. 4(1), pages 1-38, November.
    2. Pierpaolo Battigalli & Marciano Siniscalchi, "undated". "Rationalizable Bidding in General First-Price Auctions," Working Papers 190, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    3. Guesnerie, Roger, 1992. "An Exploration of the Eductive Justifications of the Rational-Expectations Hypothesis," American Economic Review, American Economic Association, vol. 82(5), pages 1254-1278, December.
    4. Battigalli, Pierpaolo & Siniscalchi, Marciano, 2003. "Rationalizable bidding in first-price auctions," Games and Economic Behavior, Elsevier, vol. 45(1), pages 38-72, October.
    5. Pearce, David G, 1984. "Rationalizable Strategic Behavior and the Problem of Perfection," Econometrica, Econometric Society, vol. 52(4), pages 1029-1050, July.
    6. Battigalli, P., 1999. "Rationalizability in Incomplete Information Games," Economics Working Papers eco99/17, European University Institute.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Roger Guesnerie, 2005. "Strategic Substitutabilities Versus Strategic Complementarities : Towards a General Theory of Expectational Coordination ?," Revue d'économie politique, Dalloz, vol. 115(4), pages 393-412.
    2. Azrieli, Yaron & Levin, Dan, 2011. "Dominance-solvable common-value large auctions," Games and Economic Behavior, Elsevier, vol. 73(2), pages 301-309.
    3. Bernhard Kasberger & Karl H. Schlag, 2017. "Robust Bidding in First-Price Auctions: How to Bid without Knowing what Otheres are Doing," Vienna Economics Papers 1707, University of Vienna, Department of Economics.
    4. Bernhard Kasberger & Karl H. Schlag, 2017. "Robust Bidding in First-Price Auctions: How to Bid without Knowing what Otheres are Doing," Vienna Economics Papers vie1707, University of Vienna, Department of Economics.
    5. Makoto Shimoji, 2017. "Revenue comparison of discrete private-value auctions via weak dominance," Review of Economic Design, Springer;Society for Economic Design, vol. 21(4), pages 231-252, December.
    6. Hanming Fang & Stephen Morris, 2012. "Multidimensional Private Value Auctions," World Scientific Book Chapters, in: Robust Mechanism Design The Role of Private Information and Higher Order Beliefs, chapter 9, pages 319-356, World Scientific Publishing Co. Pte. Ltd..
    7. Battigalli Pierpaolo & Siniscalchi Marciano, 2003. "Rationalization and Incomplete Information," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 3(1), pages 1-46, June.
    8. Pierpaolo Battigalli, 2006. "Rationalization In Signaling Games: Theory And Applications," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 8(01), pages 67-93.
    9. Dirk Bergemann & Benjamin Brooks & Stephen Morris, 2017. "First‐Price Auctions With General Information Structures: Implications for Bidding and Revenue," Econometrica, Econometric Society, vol. 85, pages 107-143, January.
    10. Harry J. Paarsch & Jacques Robert, 2003. "Testing Equilibrium Behaviour At First-Price, Sealed-Bid Auctions With Discrete Bid Increments," CIRANO Working Papers 2003s-32, CIRANO.
    11. Pierpaolo Battigalli & Marciano Siniscalchi, "undated". "Rationalizable Bidding in General First-Price Auctions," Working Papers 190, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    12. Backus, Matthew R. & Podwol, Joseph Uri & Schneider, Henry S., 2014. "Search costs and equilibrium price dispersion in auction markets," European Economic Review, Elsevier, vol. 71(C), pages 173-192.
    13. Shimoji, Makoto & Schweinzer, Paul, 2015. "Implementation without incentive compatibility: Two stories with partially informed planners," Games and Economic Behavior, Elsevier, vol. 91(C), pages 258-267.
    14. Peters, Michael & Severinov, Sergei, 2006. "Internet auctions with many traders," Journal of Economic Theory, Elsevier, vol. 130(1), pages 220-245, September.
    15. Itzhak Rasooly & Carlos Gavidia-Calderon, 2020. "The importance of being discrete: on the inaccuracy of continuous approximations in auction theory," Papers 2006.03016, arXiv.org, revised Aug 2022.
    16. Dirk Bergemann & Benjamin Brooks & Stephen Morris, 2013. "Extremal Information Structures in the First Price Auction," Working Papers 055-2013, Princeton University, Department of Economics, Econometric Research Program..
    17. In-Koo Cho, 2004. "Monotonicity and Rationalizability in Large Uniform Price and Double Auctions," Theory workshop papers 658612000000000076, UCLA Department of Economics.
    18. Azrieli Yaron & Levin Dan, 2012. "Dominance Solvability of Large k-Price Auctions," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 12(1), pages 1-11, May.
    19. Mass, Helene, 2018. "Strategies under strategic uncertainty," ZEW Discussion Papers 18-055, ZEW - Leibniz Centre for European Economic Research.
    20. Battigalli, Pierpaolo & Siniscalchi, Marciano, 2003. "Rationalizable bidding in first-price auctions," Games and Economic Behavior, Elsevier, vol. 45(1), pages 38-72, October.
    21. Lavi, Ron & Nisan, Noam, 2015. "Online ascending auctions for gradually expiring items," Journal of Economic Theory, Elsevier, vol. 156(C), pages 45-76.
    22. Jack Robles & Makoto Shimoji, "undated". "On Rationalizable Outcomes in Private-Value First-Price Discrete Auctions," Discussion Papers 09/21, Department of Economics, University of York.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Shimoji, Makoto & Schweinzer, Paul, 2015. "Implementation without incentive compatibility: Two stories with partially informed planners," Games and Economic Behavior, Elsevier, vol. 91(C), pages 258-267.
    2. Battigalli, Pierpaolo & Siniscalchi, Marciano, 2003. "Rationalizable bidding in first-price auctions," Games and Economic Behavior, Elsevier, vol. 45(1), pages 38-72, October.
    3. Battigalli Pierpaolo & Siniscalchi Marciano, 2003. "Rationalization and Incomplete Information," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 3(1), pages 1-46, June.
    4. Pierpaolo Battigalli, 2006. "Rationalization In Signaling Games: Theory And Applications," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 8(01), pages 67-93.
    5. Roger Guesnerie & Pedro Jara-Moroni, 2007. "Expectational coordination in a class of economic models: Strategic substitutabilities versus strategic complementarities," PSE Working Papers halshs-00587837, HAL.
    6. Lawrence Christiano & Husnu Dalgic & Xiaoming Li, 2022. "Modelling the Great Recession as a Bank Panic: Challenges," Economica, London School of Economics and Political Science, vol. 89(S1), pages 200-238, June.
    7. Gabriel Desgranges & Stéphane Gauthier, 2013. "Asymmetric information and rationalizability," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 54(3), pages 789-804, November.
    8. Jara-Moroni, Pedro, 2018. "Rationalizability and mixed strategies in large games," Economics Letters, Elsevier, vol. 162(C), pages 153-156.
    9. Jara-Moroni, Pedro, 2012. "Rationalizability in games with a continuum of players," Games and Economic Behavior, Elsevier, vol. 75(2), pages 668-684.
    10. Roger Guesnerie & Pedro Jara-Moroni, 2011. "Expectational coordination in simple economic contexts," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 47(2), pages 205-246, June.
    11. Nagel, Rosemarie & Bühren, Christoph & Frank, Björn, 2017. "Inspired and inspiring: Hervé Moulin and the discovery of the beauty contest game," Mathematical Social Sciences, Elsevier, vol. 90(C), pages 191-207.
    12. Haomiao Yu, 2014. "Rationalizability in large games," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 55(2), pages 457-479, February.
    13. Takashi Kunimoto & Roberto Serrano, 2020. "Rationalizable Incentives: Interim Implementation of Sets in Rationalizable Strategies," Working Papers 2020-15, Brown University, Department of Economics.
    14. Rochon, Celine, 2006. "Devaluation without common knowledge," Journal of International Economics, Elsevier, vol. 70(2), pages 470-489, December.
    15. Bao, Te & Duffy, John, 2016. "Adaptive versus eductive learning: Theory and evidence," European Economic Review, Elsevier, vol. 83(C), pages 64-89.
    16. Dirk Bergemann & Stephen Morris, 2012. "Robust Implementation in Direct Mechanisms," World Scientific Book Chapters, in: Robust Mechanism Design The Role of Private Information and Higher Order Beliefs, chapter 4, pages 153-194, World Scientific Publishing Co. Pte. Ltd..
    17. Nyarko, Yaw, 1997. "Convergence in Economic Models with Bayesian Hierarchies of Beliefs," Journal of Economic Theory, Elsevier, vol. 74(2), pages 266-296, June.
    18. Tercieux, Olivier, 2006. "p-Best response set," Journal of Economic Theory, Elsevier, vol. 131(1), pages 45-70, November.
    19. Ayan Bhattacharya, 2022. "Arbitrage from a Bayesian's Perspective," Papers 2211.03244, arXiv.org.
    20. Evans, George W. & Guesnerie, Roger, 2005. "Coordination on saddle-path solutions: the eductive viewpoint--linear multivariate models," Journal of Economic Theory, Elsevier, vol. 124(2), pages 202-229, October.

    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nwu:cmsems:1321. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://edirc.repec.org/data/cmnwuus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Fran Walker The email address of this maintainer does not seem to be valid anymore. Please ask Fran Walker to update the entry or send us the correct address (email available below). General contact details of provider: https://edirc.repec.org/data/cmnwuus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.