Sequential vs. Single-Round Uniform-Price Auctions

Claudio Mezzetti, Aleksandar Pekec and Ilia Tsetlin

No 05/26, Discussion Papers in Economics from Division of Economics, School of Business, University of Leicester

Abstract: We study sequential and single-round uniform-price auctions with affiliated values. We derive symmetric equilibrium for the auction in which k1 objects are sold in the first round and k2 in the second round, with and without revelation of the first-round winning bids. We demonstrate that auctioning objects in sequence generates a lowballing effect that reduces the first-round price. Total revenue is greater in a single-round, uniform auction for k = k1 + k2 objects than in a sequential uniform auction with no bid announcement. When the first-round winning bids are announced, we also identify a positive informational effect on the second-round price. Total expected revenue in a sequential uniform auction with winning-bids announcement may be greater or smaller than in a single-round uniform auction, depending on the model’s parameters.

Keywords: Multi-Unit Auctions; Sequential Auctions; Uniform-Price Auction; Affiliated Values; Information Revelation (search for similar items in EconPapers)
JEL-codes: D44 D82 (search for similar items in EconPapers)
Date: 2005-08, Revised 2007-04
New Economics Papers: this item is included in nep-gth and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Sequential vs. single-round uniform-price auctions (2008)
Working Paper: Sequential vs. Single-Round Uniform-Price Auctions (2004)
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