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Simple Auctions, Second Version

Author

Listed:
  • Olivier Compte

    (Paris School of Economics, Paris)

  • Andrew Postlewaite

    (Department of Economics, University of Pennsylvania)

Abstract

Standard Bayesian models assume agents know and fully exploit prior distributions over types. We are interested in modeling agents who lack detailed knowledge of prior distributions. In auctions, that agents know priors has two consequences: (i) signals about own valuation come with precise inference about signals received by others; (ii) noisier estimates translate into more weight put on priors. We revisit classic questions in auction theory, exploring environments in which no such complex inferences are precluded. This is done in a parsimonious model of auctions in which agents are restricted to using simple strategies.

Suggested Citation

  • Olivier Compte & Andrew Postlewaite, 2010. "Simple Auctions, Second Version," PIER Working Paper Archive 13-017, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 01 Apr 2013.
    • Handle: RePEc:pen:papers:13-017
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    References listed on IDEAS

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    1. Eccles, Peter & Wegner, Nora, 2017. "Scalable games: modelling games of incomplete information," Bank of England working papers 641, Bank of England.

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    More about this item

    Keywords

    Auctions; Bayesian Problems;

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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