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Coasian Dynamics in Repeated English Auctions

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Abstract

We extend the Coase conjecture to the case of a seller with a single object, who faces n potential buyers and holds a sequence of English auctions until the object is sold. In an independent-private-values environment in which buyers and sellers share the same discount factor, we show that the (perfect Bayesian) equilibrium path of reserve prices obeys a Coasian logic. Moreover, the equilibrium reserve path lies below that for the model of repeated sealed-bid, second-price auctions studied by McAfee and Vincent (1997). Nevertheless, the open (English) and sealed-bid formats are shown to be revenue equivalent.

Suggested Citation

  • Flavio M. Menezes & Matthew J. Ryan, 2007. "Coasian Dynamics in Repeated English Auctions," Discussion Papers Series 349, School of Economics, University of Queensland, Australia.
    • Handle: RePEc:qld:uq2004:349
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    File URL: https://economics.uq.edu.au//files/44467/349.pdf
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    Cited by:

    1. is not listed on IDEAS
    2. Patrick Hummel, 2018. "Reserve prices in repeated auctions," International Journal of Game Theory, Springer;Game Theory Society, vol. 47(1), pages 273-299, March.

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    JEL classification:

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

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