Three Sequential Cases: from Symmetry to Asymmetry
Three critical cases, involving asymmetric and symmetric cases, in the sequential stages of the n-player repeated auctions are analyzed and compared. These cases might arise in a process of sequential, identical or equivalent auctions, where the auction result may reveal information about the strength or competitiveness of the participants. The behaviours of different players are characterized. Generally a player bids more aggressively when facing a strong player rather than a weak player. However a player favours competing with a weak one rather than a strong one. By applying the concept of Conditional Stochastic Dominance, revenues of players and the seller between the three stages are compared. It is proved that in this sequential process the information structure of the auctions changes and the sellerï¿½s revenue increases. Finally, this n-player asymmetric auction model can also be used to compare the revenues between high-bid and open auctions and especially the results first derived by Maskin and Riley (2000) in two-player case are proved to be valid in the n-player case.
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- Eric Maskin & John Riley, 2003.
"Uniqueness of Equilibrium in Sealed High-Bid Auctions,"
Economics Working Papers
0031, Institute for Advanced Study, School of Social Science.
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- Eric Maskin & John Riley, 2000. "Equilibrium in Sealed High Bid Auctions," Review of Economic Studies, Oxford University Press, vol. 67(3), pages 439-454.
- Eric Maskin & John Riley, 2000. "Asymmetric Auctions," Review of Economic Studies, Oxford University Press, vol. 67(3), pages 413-438.
- Gradstein, Mark & Konrad, Kai A, 1999. "Orchestrating Rent Seeking Contests," Economic Journal, Royal Economic Society, vol. 109(458), pages 536-45, October.
- Richard L. Fullerton & R. Preston McAfee, 1999. "Auctioning Entry into Tournaments," Journal of Political Economy, University of Chicago Press, vol. 107(3), pages 573-605, June.
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