First-price auctions with unobservable entry

Xiaoyong Cao and Wei Wang

Economics Letters, 2024, vol. 239, issue C

Abstract: We study the endogenous participation problem when bidders are characterized by a two-dimensional private information on values and participation costs in first-price auctions. Bidders make entry and bidding decisions simultaneously. Bidders participate whenever their costs are not greater than the expected revenue from participating. We show the existence and uniqueness of the symmetric equilibrium.

Keywords: Existence and uniqueness; Two-dimensional private information; First-price auctions; Simultaneous entry; Participation costs (search for similar items in EconPapers)
JEL-codes: D42 D62 D82 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:239:y:2024:i:c:s0165176524002465

DOI: 10.1016/j.econlet.2024.111762

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