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Why Every Economist Should Learn Some Auction Theory

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  • Paul Klemperer

    (Nuffield College Oxford University)

Abstract

This is an Invited paper for the World Congress of the Econometric Society held in Seattle in August 2000. We discuss the strong connections between auction theory and "standard" economic theory, and argue that auction-theoretic tools and intuitions can provide useful arguments and insights in a broad range of mainstream economic settings that do not, at first sight, look like auctions. We also discuss some more obvious applications, especially to industrial organization.

Suggested Citation

  • Paul Klemperer, 2000. "Why Every Economist Should Learn Some Auction Theory," Microeconomics 0004009, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpmi:0004009
    Note: Type of Document - pdf; prepared on PC; pages: 51; figures: included
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Natalia Fabra & Nils‐Henrik Fehr & David Harbord, 2006. "Designing electricity auctions," RAND Journal of Economics, RAND Corporation, vol. 37(1), pages 23-46, March.
    2. Paul Klemperer, 2002. "What Really Matters in Auction Design," Journal of Economic Perspectives, American Economic Association, vol. 16(1), pages 169-189, Winter.
    3. Ali Hortacsu & Steven L. Puller, 2005. "Understanding Strategic Bidding in Restructured Electricity Markets: A Case Study of ERCOT," NBER Working Papers 11123, National Bureau of Economic Research, Inc.
    4. Boone, Jan, 2002. "'Be Nice, Unless it Pays to Fight': A New Theory of Price Determination with Implications for Competition Policy," CEPR Discussion Papers 3342, C.E.P.R. Discussion Papers.
    5. Daniel A. Benitez, 2004. "On Quantity Competition and Transmission Constraints in Electricity Market," Econometric Society 2004 Latin American Meetings 98, Econometric Society.
    6. Klemperer, Paul, 2002. "How (not) to run auctions: The European 3G telecom auctions," European Economic Review, Elsevier, vol. 46(4-5), pages 829-845, May.
    7. Stenborg, Markku, 2003. "Waiting for F/OSS: Coordinating the Production of Free/Open Source Software," Discussion Papers 884, The Research Institute of the Finnish Economy.
    8. Paul Klemperer, 2002. "Some Observations on the British and German 3G Telecom Auctions," Economics Papers 2002-W20, Economics Group, Nuffield College, University of Oxford.
    9. Alexia Gaudeul, 2009. "A (Micro) Course in Microeconomic Theory for MSc Students," Working Papers id:1986, eSocialSciences.
    10. Uður Emek, 2002. "The Role of Auction Design in Awarding Spectrum," Game Theory and Information 0209001, University Library of Munich, Germany.
    11. Luca Lambertini & Manuela Mosca, 2014. "The Bertrand Paradox, the Useless Auctioneer and the Launhardt Model," Australian Economic Papers, Wiley Blackwell, vol. 53(3-4), pages 170-183, December.
    12. Axel Ockenfels, 2002. "New Institutional Structures on the Internet: The Economic Design of Online Auctions," Papers on Strategic Interaction 2002-08, Max Planck Institute of Economics, Strategic Interaction Group.

    More about this item

    Keywords

    Auctions; Bidding; Auction Theory; Private Values; Common Values; Mechanism Design; Litigation; Stock Markets; Queues; Financial Crashes; Brand Loyalty; War of Attrition; Bertrand; Perfect Competition; E-Commerce; Spectrum Auctions; Treasury Auctions; Electricity;

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • L - Industrial Organization
    • A - General Economics and Teaching
    • G - Financial Economics
    • K - Law and Economics
    • D6 - Microeconomics - - Welfare Economics
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H - Public Economics
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • J - Labor and Demographic Economics

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