"Upping the ante": how to design efficient auctions with entry?

Laurent Lamy

PSE-Ecole d'économie de Paris (Postprint) from HAL

Abstract: Of primary importance in auction design is the set of strategies available to the seller at the auction stage. We first formalize hold-up regarding entry costs that preys on second-price auctions when the seller may engage in a costly shill-bidding activity. We derive the optimal reserve and show how shill bidding can make posted prices outperforming auctions. Second, we advocate for a new regulation where shills would be banned but with the possibility of canceling sales ex post, which offers some valuable flexibility: the English auction with jump bids implements, then, the first best in general environments.

Keywords: Auction; Design (search for similar items in EconPapers)
Date: 2013-06
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Citations: View citations in EconPapers (11)

Published in RAND Journal of Economics, 2013, 44 (2), pp.194-214. ⟨10.1111/1756-2171.12017⟩

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Related works:
Journal Article: “Upping the ante”: how to design efficient auctions with entry? (2013)
Working Paper: "Upping the ante": how to design efficient auctions with entry? (2013)
Working Paper: "Upping the ante": How to design efficient auctions with entry? (2010)
Working Paper: "Upping the ante": How to design efficient auctions with entry? (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:halshs-00840844

DOI: 10.1111/1756-2171.12017

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