No-trade in second-price auctions with entry costs and secret reserve prices

Stefano Lovo and Christophe Spaenjers

Economics Letters, 2017, vol. 156, issue C, 142-144

Abstract: We consider a second-price private-value auction in the presence of an exogenous participation cost and a secret reserve price endogenously set by the seller. We show that, if the entry cost is strictly positive, the only equilibrium outcome is that the seller chooses a reserve price that deters entry and no buyer enters.

Keywords: Auctions; Entry; Participation costs; Reserve prices; No-trade equilibria (search for similar items in EconPapers)
JEL-codes: D44 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165176517301702
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:156:y:2017:i:c:p:142-144

DOI: 10.1016/j.econlet.2017.04.022

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().