Ex-Post Full Surplus Extraction, Straightforwardly

Ronald Harstad and Vlad Mares

No 515, Working Papers from Department of Economics, University of Missouri

Abstract: Consider an estimate of the common value of an auctioned asset that is symmetric in the bidders' types. Such an estimate can be represented solely in terms of the order statistics of those types. This representation forms the basis for a pricing rule yielding truthful bidding as an equilibrium, whether bidders'types are affiliated or independent. We highlight the link between the estimator and full surplus extraction, providing a necessary and suffient condition for ex-post full surplus extraction, including the possibility of independent types. The results offer sharp insights into the strengths and limits of simple auctions by identifying the source of informational rents in such environments.

Keywords: Auctions; Full Surplus Extraction; Order Statistic Estimates (search for similar items in EconPapers)
JEL-codes: C72 D44 D61 (search for similar items in EconPapers)
Pages: 16 pgs.
Date: 2005-11-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Published in Economic Theory 2007

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Journal Article: Ex-post full surplus extraction, straightforwardly (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:umc:wpaper:0515

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