Hiding Information in Open Auctions with Jump Bids

David Ettinger () and Fabio Michelucci
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David Ettinger: LEDa - Laboratoire d'Economie de Dauphine - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres

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Abstract: We analyse a rationale for hiding information in open ascending auction formats. We focus on the incentives for a bidder to call a price higher than the highest standing one in order to prevent the remaining active bidders from aggregating more accurate information by observing the exact drop out values of the opponents who exit the auction. We show that the decision whether to allow jump bids or not can have a drastic impact on revenue and efficiency.

Keywords: Auction; jump bids; efficiency; revenue (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-des and nep-mic
Note: View the original document on HAL open archive server: https://hal.science/hal-01432853v1
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Citations: View citations in EconPapers (7)

Published in The Economic Journal, 2016, 126 (594), pp.1484 - 1502. ⟨10.1111/ecoj.12243⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01432853

DOI: 10.1111/ecoj.12243

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