Incumbency and Entry in License Auctions: The Anglo-Dutch Auction Meets Other Simple Alternatives
Helmuts Azacis () and
No E2005/11, Cardiff Economics Working Papers from Cardiff University, Cardiff Business School, Economics Section
The existence of ex-ante strong incumbents may constitute a barrier to entry in auctions for goods such as licenses. Introducing inefficiencies that favor entrants is a way to induce entry and thus create competition. Designs such as the Anglo-Dutch auction have been proposed with this goal in mind. We first show that indeed the Anglo- Dutch auction fosters entry and increases the revenues of the seller. However, we argue that a more eective way could be to stage the allocation of the good so that each stage reveals information about the participants. We show that a sequence of English auctions, with high reserve prices in early rounds, is a procedure with this property that is more efficient than any one-stage entry auction. Moreover, it also dominates the Anglo-Dutch auction in terms of seller's revenues.
Pages: 32 pages
New Economics Papers: this item is included in nep-com and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Published in International Journal of Industrial Organization , 26(3), pp. 730-745, May 2008
Downloads: (external link)
Journal Article: Incumbency and entry in license auctions: The Anglo-Dutch auction meets another simple alternative (2008)
Working Paper: Incumbency and Entry in Licence Auctions: The Anglo-Dutch Auctions Meets other Simple Alternatives (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:cdf:wpaper:2005/11
Access Statistics for this paper
More papers in Cardiff Economics Working Papers from Cardiff University, Cardiff Business School, Economics Section Contact information at EDIRC.
Bibliographic data for series maintained by Yongdeng Xu ().