Auctions, Actions, and the Failure of Information Aggregation

Alp Atakan and Mehmet Ekmekci ()

American Economic Review, 2014, vol. 104, issue 7, 2014-48

Abstract: We study a uniform-price auction where k identical common-value objects are allocated amongst z > k bidders who have imperfect signals about the state of the world. The common valuation is determined jointly by the state and an action that is chosen after winning an object. In large auctions, there are symmetric equilibria where the auction price aggregates no information. Moreover, market statistics other than price (e.g., the amount of rationing or the bid distribution) contain extra information about the state. In contrast, in standard large auctions without actions, the price aggregates all relevant information.

JEL-codes: D44 D82 D83 (search for similar items in EconPapers)
Date: 2014
Note: DOI: 10.1257/aer.104.7.2014
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Citations: View citations in EconPapers (17)

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Working Paper: Auctions, Actions, and the Failure of Information Aggregation (2012)
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