On the analysis of asymmetric first price auctions

Vlad Mares and Jeroen M. Swinkels

Journal of Economic Theory, 2014, vol. 152, issue C, 1-40

Abstract: We provide new tools for studying asymmetric first price auctions, connecting their equilibria to the ρ-concavity of the underlying type distributions, and showing how one can use surplus expressions for symmetric auctions to bound equilibrium behavior in asymmetric auctions. We apply these tools to studying procurement auctions in which, as is common in practice, one seller is given an advantage, reflecting for example better reliability or quality. We show conditions under which for any given first price handicap auction, there exists a superior second price auction with bonuses.

Keywords: Asymmetric auctions; Request for proposal; Differentiation; Mechanism design; First price auctions; Second price auctions; Procurement; Rho-concavity (search for similar items in EconPapers)
JEL-codes: D44 D82 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:152:y:2014:i:c:p:1-40

DOI: 10.1016/j.jet.2014.03.010

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