Author: Richard Engelbrecht-Wiggans
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 32
Book Description
Sequential Auctions with Continuation Costs
Author: Richard Engelbrecht-Wiggans
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 32
Book Description
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 32
Book Description
Sequential Auctions with Generalized Interdependent Values
Author: Audrey Hu
Publisher:
ISBN:
Category :
Languages : en
Pages : 32
Book Description
A common assumption in the analysis of symmetric auctions is that the bidders' value estimates exhibit positive informational externalities (PIE). This assumption implies upward drifting price sequences at sequential auctions, which is challenged by an empirical regularity, known as the "declining price anomaly," that observed price sequences at real sequential auctions tend to be downward-drifting. This paper extends the existing analysis to a generalized interdependent values environment, in which the bidders' values can exhibit both PIE and NIE (negative informational externalities). The case of NIE can arise naturally when competing bidders are also competitors in the same product market. If a bidder's type is related to his or his firm's ensuing competitive advantage, then an increase of a bidder's type increases his own but may decrease other bidders' expected values.We consider a general sequential auction mechanism that sells m identical objects through K (≤m) consecutive rounds, each round involving possibly a different number of objects for sale and a different payment rule. For risk neutral bidders having unit demand and independent types, we obtain two major results. First, the direct sequentially incentive compatible auction mechanisms, which implement the performance of essentially all standard auctions, are feasible under both PIE and NIE. Second, while the total expected revenue is invariant to sequencing and payment rules, the expected selling prices from different rounds of the auction are not the same. In a PIE environment the expected price sequence tends to be upward drifting, whereas in an NIE environment the expected price sequence is strongly downward drifting: the expected lowest price in round k exceeds the expected highest price in round k 1. The declining price "anomaly" could, therefore, be evidence of bidders' values featuring NIE or post-auction competition.
Publisher:
ISBN:
Category :
Languages : en
Pages : 32
Book Description
A common assumption in the analysis of symmetric auctions is that the bidders' value estimates exhibit positive informational externalities (PIE). This assumption implies upward drifting price sequences at sequential auctions, which is challenged by an empirical regularity, known as the "declining price anomaly," that observed price sequences at real sequential auctions tend to be downward-drifting. This paper extends the existing analysis to a generalized interdependent values environment, in which the bidders' values can exhibit both PIE and NIE (negative informational externalities). The case of NIE can arise naturally when competing bidders are also competitors in the same product market. If a bidder's type is related to his or his firm's ensuing competitive advantage, then an increase of a bidder's type increases his own but may decrease other bidders' expected values.We consider a general sequential auction mechanism that sells m identical objects through K (≤m) consecutive rounds, each round involving possibly a different number of objects for sale and a different payment rule. For risk neutral bidders having unit demand and independent types, we obtain two major results. First, the direct sequentially incentive compatible auction mechanisms, which implement the performance of essentially all standard auctions, are feasible under both PIE and NIE. Second, while the total expected revenue is invariant to sequencing and payment rules, the expected selling prices from different rounds of the auction are not the same. In a PIE environment the expected price sequence tends to be upward drifting, whereas in an NIE environment the expected price sequence is strongly downward drifting: the expected lowest price in round k exceeds the expected highest price in round k 1. The declining price "anomaly" could, therefore, be evidence of bidders' values featuring NIE or post-auction competition.
Synergies and Price Trends in Sequential Auctions
Author: Flavio F. Menezes
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 32
Book Description
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 32
Book Description
Sequential Auctions with Waiting Costs
Author: Srobonti Chattopadhyay
Publisher:
ISBN:
Category :
Languages : en
Pages : 9
Book Description
For certain types of goods, the multiple unit auctions have to be conducted sequentially. One probable reason for this is that the different units of the goods are not available together for putting up for sale. This might happen when the objects are available in batches to the auctioneer and do not come together. In such sequential auctions, there may be waiting costs involved for the bidders. This note makes an attempt to look at the bidding behaviour when waiting costs are private information for the bidders and therefore constitute types. The results derived suggest that, in a symmetric, independent, private valuations framework, with risk neutral bidders, there exists a symmetric Perfect Bayesian equilibrium bidding strategy, for which the bids are increasing in types in the first stage and decreasing in types in the second stage.
Publisher:
ISBN:
Category :
Languages : en
Pages : 9
Book Description
For certain types of goods, the multiple unit auctions have to be conducted sequentially. One probable reason for this is that the different units of the goods are not available together for putting up for sale. This might happen when the objects are available in batches to the auctioneer and do not come together. In such sequential auctions, there may be waiting costs involved for the bidders. This note makes an attempt to look at the bidding behaviour when waiting costs are private information for the bidders and therefore constitute types. The results derived suggest that, in a symmetric, independent, private valuations framework, with risk neutral bidders, there exists a symmetric Perfect Bayesian equilibrium bidding strategy, for which the bids are increasing in types in the first stage and decreasing in types in the second stage.
Declining Prices in Sequential Auctions with Complete Revelation of Bids
Author: Karthik Natarajan Kannan
Publisher:
ISBN:
Category :
Languages : en
Pages : 8
Book Description
In a sequential-auction setting, the expected-winning price is shown to decline across two stages when all bids are revealed between the stages. The prices decline because bidders desire to hide their private valuation information. The hiding also leads to ine cient allocations.
Publisher:
ISBN:
Category :
Languages : en
Pages : 8
Book Description
In a sequential-auction setting, the expected-winning price is shown to decline across two stages when all bids are revealed between the stages. The prices decline because bidders desire to hide their private valuation information. The hiding also leads to ine cient allocations.
A Theory of Costly Sequential Bidding
Author: Kent D. Daniel
Publisher:
ISBN:
Category :
Languages : en
Pages : 41
Book Description
Publisher:
ISBN:
Category :
Languages : en
Pages : 41
Book Description
Stationary Sequential Auctions
Author: Haim Reisman
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
The paper derives an optimal bidding strategy for a person that wishes to buy a product, e.g., a TV set, by bidding repeatedly in a sequence of second price auctions for such product until winning. This optimal bidding strategy depends on the distribution of the highest bid of the other bidders, and the cost to the bidder from not owning the product until winning. This is different from the standard results in which it is optimal to bid the highest price you are willing to pay.
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
The paper derives an optimal bidding strategy for a person that wishes to buy a product, e.g., a TV set, by bidding repeatedly in a sequence of second price auctions for such product until winning. This optimal bidding strategy depends on the distribution of the highest bid of the other bidders, and the cost to the bidder from not owning the product until winning. This is different from the standard results in which it is optimal to bid the highest price you are willing to pay.
Sequential Auctions with Supply Uncertainty
Author: Paul Pezanis-Christou
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 44
Book Description
Publisher:
ISBN:
Category : Auctions
Languages : en
Pages : 44
Book Description
Learning in Sequential Auctions
Author: Thomas D. Jeitschko
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
The importance of information transmission and learning is studied in a model of a sequential auction in which bidders have independent private values. In the course of the auction information about the bidders' values becomes available, as winning bids are revealed. From this bidders learn about their opponents' types. A more subtle effect of information is that bidders anticipate the generation of information and take this into account in the first auction. The equilibrium in this model is contrasted to a scenario in which bidders are unaware of informational effects. It is shown that bidders who are aware of informational effects place lower bids on average and hence have higher payoffs. Properties of the equilibrium price path are studied. Regardless of the outcome of the first auction, the second price is expected to be equal to the first price. Despite this, the probability of a decreasing price sequence depends on the information generated in the first auction. Finally, it is shown that a simultaneous auction, in which informational effects are absent, yields the same expected final allocation as the equilibrium.
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
The importance of information transmission and learning is studied in a model of a sequential auction in which bidders have independent private values. In the course of the auction information about the bidders' values becomes available, as winning bids are revealed. From this bidders learn about their opponents' types. A more subtle effect of information is that bidders anticipate the generation of information and take this into account in the first auction. The equilibrium in this model is contrasted to a scenario in which bidders are unaware of informational effects. It is shown that bidders who are aware of informational effects place lower bids on average and hence have higher payoffs. Properties of the equilibrium price path are studied. Regardless of the outcome of the first auction, the second price is expected to be equal to the first price. Despite this, the probability of a decreasing price sequence depends on the information generated in the first auction. Finally, it is shown that a simultaneous auction, in which informational effects are absent, yields the same expected final allocation as the equilibrium.
Equilbrium Price Paths in Sequential Auctions with Stochastic Supply
Author: Thomas D. Jeitschko
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
In many sequential auctions the total number of units to be auctioned is not known at the outset of the auction. However, information regarding the number of units may become available in the course of the auction. The paper examines how such information impacts the formation of prices during the sequence of sales.
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
In many sequential auctions the total number of units to be auctioned is not known at the outset of the auction. However, information regarding the number of units may become available in the course of the auction. The paper examines how such information impacts the formation of prices during the sequence of sales.