Auction Design Critical for Rescue Plan
Lawrence M. Ausubel () and
Peter Cramton ()
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Lawrence M. Ausubel: Economics Department, University of Maryland, http://www.econ.umd.edu
Papers of Peter Cramton from University of Maryland, Department of Economics - Peter Cramton
The Treasury proposes to invest $700 billion in mortgage-related securities to resolve the financial crisis, using market mechanisms such as reverse auctions to determine prices. A well-designed auction process can indeed be an effective tool for acquiring distressed assets at minimum cost to the taxpayer. However, a simplistic process could lead to higher cost and fewer securities purchased. It is critical for the auction process to be designed carefully.
Keywords: Auctions; financial auctions; financial crisis (search for similar items in EconPapers)
JEL-codes: D44 G01 G21 (search for similar items in EconPapers)
Pages: 3 pages
Date: 2008, Revised 2008
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Published in The Economists' Voice, 5:5, www.bepress.com/ev/vol5/iss5/art5, September 2008
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Journal Article: Auction Design Critical for Rescue Plan (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:pcc:pccumd:08adcfrp
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