Resale in second-price auctions with costly participation

Gorkem Celik and Okan Yilankaya

International Journal of Industrial Organization, 2017, vol. 54, issue C, 148-174

Abstract: We study sealed-bid second-price auctions with costly participation and resale. Each bidder chooses to participate in the auction if her valuation is higher than her optimally chosen participation cutoff. If resale is not allowed and the bidder valuations are drawn from a strictly convex distribution function, the symmetric equilibrium (where all bidders use the same cutoff) is less efficient than a class of two-cutoff asymmetric equilibria. Existence of these equilibria without resale is sufficient for existence of similarly constructed two-cutoff equilibria with resale. Moreover, the equilibria with resale are “more asymmetric” and (under a sufficient condition) more efficient than the corresponding equilibria without resale.

Keywords: Second-price auctions; Resale; Participation cost; Endogenous entry; Endogenous valuations (search for similar items in EconPapers)
JEL-codes: C72 D44 D82 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Resale in Second-Price Auctions with Costly Participation (2016)
Working Paper: Resale in Second-Price Auctions with Costly Participation (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:54:y:2017:i:c:p:148-174

DOI: 10.1016/j.ijindorg.2017.06.009

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