Signal-Jamming in a Sequential Auction

Wei Ding (), Elmar Wolfstetter () and Thomas D. Jeitschko ()
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Wei Ding: Bonn Graduate School of Economics

No 261, Discussion Papers from SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich

Abstract: In a recurring auction early bids may reveal bidders’ types, which in turn affects bidding in later auctions. Bidders take this into account and may bid in a way that conceals their private information until the last auction is played. The present paper analyzes the equilibrium of a sequence of first- price auctions assuming bidders have stable private values. We show that signal-jamming occurs and explore the dynamics of equilibrium prices.

Keywords: auctions; signaling; price competition (search for similar items in EconPapers)
JEL-codes: D44 D02 D43 (search for similar items in EconPapers)
Date: Written

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