Partition Equilibria in a Japanese-English Auction with Discrete Bid Levels for the Wallet Game

Ricardo Gonçalves and Indrajit Ray ()

CRETA Online Discussion Paper Series from Centre for Research in Economic Theory and its Applications CRETA

Abstract: We consider the set-up of a Japanese-English auction with exogenously fi xed discrete bid levels for the wallet game with two bidders, following Gonçalves and Ray (2017). We show that in this auction, partition equilibria exist that may be separating or pooling. We illustrate some separating and pooling equilibria with two and three discrete bid levels. We also compare the revenues of the seller from these equilibria and thereby nd the optimal choices of bid levels for these cases.

Keywords: Japanese-English auctions; wallet game; discrete bids, partitions; pooling equilibrium; separating equilibrium. JEL classification numbers: C72; D44 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-des, nep-gth and nep-mic
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Persistent link: https://EconPapers.repec.org/RePEc:wrk:wcreta:34

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