A Study of the Internal Organization of a Bidding Cartel

John Asker

American Economic Review, 2010, vol. 100, issue 3, 724-62

Abstract: This paper examines bidding in over 1,700 knockout auctions used by a bidding cartel (or ring) of stamp dealers in the 1990s. The knockout was conducted using a variant of the model studied by Daniel Graham, Robert Marshall, and Jean-Francois Richard (1990). Following a reduced form examination of these data, damages, induced inefficiency, and the ring's benefit from colluding are estimated using a structural model in the spirit of Emmanuel Guerre, Isabelle Perrigne, and Quang Vuong (2000). A notable finding is that nonring bidders suffered damages that were of the same order of magnitude as those of the sellers. (JEL D43, D44, L12)

JEL-codes: D43 D44 L12 (search for similar items in EconPapers)
Date: 2010
Note: DOI: 10.1257/aer.100.3.724
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Citations: View citations in EconPapers (93)

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