Title: Auctions with variable supply : uniform price versus discriminatory
Authors : Damianov, Damian S.
Becker, Johannes Gerd
Published in : European Economic Review
Volume(Issue) : 2008
Issue : 4
Pages : 571
Pages to: 593
Publisher / Ed. Institution : Elsevier
Issue Date: 2009
License (according to publishing contract) : Licence according to publishing contract
Type of review: Peer review (Publication)
Language : English
Subject (DDC) : 658.8: Marketing management
Abstract: We examine an auction in which the seller determines the supply after observing the bids. We compare the uniform price and the discriminatory auction in a setting of supply uncertainty. Uncertainty is caused by the interplay of two factors: the seller's private information about marginal cost, and the seller's incentive to sell the profit-maximizing quantity given the received bids. In every symmetric mixed strategy equilibrium, bidders submit higher bids in the uniform price auction than in the discriminatory auction. In the two-bidder case this result extends to the set of rationalizable strategies. As a consequence, we find that the uniform price auction generates higher expected revenue for the seller and higher trade volume
Departement: School of Management and Law
Publication type: Article in scientific Journal
DOI : 10.1016/j.euroecorev.2009.09.002
ISSN: 0014-2921
URI: https://digitalcollection.zhaw.ch/handle/11475/8488
Appears in Collections:Publikationen School of Management and Law

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