Revenue and Efficiency in Revenue and Efficiency in Uniform-price Private Uniform-price Private
Value AuctionsValue Auctions
[email protected]@cergecerge-ei.-ei.czcz
Michal BresMichal Breskyky
(Summer 2007)
Properties of Private-value Uniform-price Auctions with the Reservation Price
Literature:
Dasgupta and Maskin (1986) RES, Reny (1996) Econometrica, Simon and Zame (1990) Econometrica, Matthew and Swinkels (1999) Econometrica, Amman and Leininger (1996) GEB, Krishna and Morgan (1997) JET, Engelbrecht-Wiggans and Kahn (1998a,b) GEB, Engelbrecht-Wiggans and Chakraborty (2005) ET,
Ausubel and Cramton (2002,2004) ET, Back and Zender (1993) RFS, Noussair (1995) ET.
Seller's goals:• Revenue - to raise high revenue.• Efficiency - to distribute units to those who value them the most.• Fair competition - to prevent collusion among bidders and attract large number of bidders before auction.• Market structure - to prevent monopoly in using the sold units after auction.
Results:
• The equilibrium strategy is strictly increasing.
• The reservation price increases the bidder strategy.
• The proper reservation price improves the efficiency of final allocation ex ante.
Properties of Private-value Uniform-price Auctions with the Reservation Price
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Thank you for your attantion.