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Bid Credits in Simultaneous Ascending Auctions

Benjamin Rosa

MPRA Paper from University Library of Munich, Germany

Abstract: I study the impact of bid credits in simultaneous ascending auctions in a model where bidders potentially have complementary values. Although bid credits can lead to a more equitable distribution of items, I find an additional unintended consequence: bidders without credits are more exposed to winning a less desirable set of items and will drop out of the auction sooner when their competitors have credits. Calibrating the model to data from the Federal Communication Commission’s sale of licenses in the 700 MHz guard bands, I find exposure reduced average non-credited dropout values by 5.7 percent but did not decrease revenues.

Keywords: Bid Credits; Simultaneous Ascending Auctions; FCC (search for similar items in EconPapers)
JEL-codes: D44 D45 H25 (search for similar items in EconPapers)
Date: 2019-11-09
New Economics Papers: this item is included in nep-des
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