Information acquisition during a descending auction

Vitali Gretschko and Achim Wambach

Economic Theory, 2014, vol. 55, issue 3, 751 pages

Abstract: We compare the effects of information acquisition during a descending auction with its static counterpart, the first-price sealed-bid auction. In a framework with heterogeneous prior information, we show that an equilibrium with information acquisition exists in both auction formats. We show that everything else equal information acquisition is more desirable in the dynamic auction. Moreover, we characterize a set of parameter values where more information is acquired in the dynamic auction in equilibrium. If the costs of information acquisition are sufficiently low, the sealed-bid auction generates more revenue although the descending auction is more efficient. Copyright Springer-Verlag Berlin Heidelberg 2014

Keywords: Descending auction; Dutch auction; First-price sealed-bid auction; Information acquisition; D44; D82; D83 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://hdl.handle.net/10.1007/s00199-013-0766-y (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Information Acquisition During a Descending Auction (2008)
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:spr:joecth:v:55:y:2014:i:3:p:731-751

Ordering information: This journal article can be ordered from
http://www.springer. ... eory/journal/199/PS2

DOI: 10.1007/s00199-013-0766-y

Access Statistics for this article

Economic Theory is currently edited by Nichoals Yanneils

More articles in Economic Theory from Springer, Society for the Advancement of Economic Theory (SAET) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().