Optimal Auctions with Simultaneous and Costly Participation
We study the optimal auction problem with participation costs in the symmetric independent private values setting, where bidders know their valuations when they make independent participation decisions. After characterizing the optimal auction in terms of participation cutoffs, we provide an example where it is asymmetric. We then investigate when the optimal auction will be symmetric/asymmetric and the nature of possible asymmetries. We also show that, under some conditions, the seller obtains her maximal profit in an (asymmetric) equilibrium of an anonymous second price auction. In general, the seller can also use non-anonymous auctions that resemble the ones that are actually observed in practice.
|Date of creation:||09 May 2005|
|Date of revision:||09 Jun 2006|
|Contact details of provider:|| Web page: http://www.economics.ubc.ca/|
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- Olivier Compte & Philippe Jehiel, 2007.
"Auctions and information acquisition: sealed bid or dynamic formats?,"
RAND Journal of Economics,
RAND Corporation, vol. 38(2), pages 355-372, 06.
- Olivier Compte & Philippe Jehiel, 2007. "Auctions and Informaton Acquisition: Sealed-bid or Dynamic Formats?," Post-Print halshs-00754227, HAL.
- Olivier Compte & Philippe Jehiel, 2005. "Auctions and Information acquisition: Sealed-bid or Dynamic Formats?," Levine's Bibliography 784828000000000495, UCLA Department of Economics.
- Campbell, Colin M., 1998. "Coordination in Auctions with Entry," Journal of Economic Theory, Elsevier, vol. 82(2), pages 425-450, October.
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