Ex Post Information in Auctions

John G. Riley

The Review of Economic Studies, 1988, vol. 55, issue 3, 409-429

Abstract: When buyers' private information about the value of an item for sale is correlated, the seller can increase expected revenue in a sealed bid auction by making the winner's payment a function of information available after the end of the auction. Specifically, revenue can be increased by making the payment a function of all the losing bids. In addition there are gains to making the payment contingent upon some signal of the object's value which becomes public at a later date. That is, there are gains to introducing positive royalty rates.

Date: 1988
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