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Competition among auctioneers in large markets

Hernando-Veciana, Ángel

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Abstract

We analyse a multistage game of competition among auctioneers. First, the auctioneers commit to some reserve prices; second, the bidders enter one auction, if any; and finally, the auctions take place. We show that for any finite set of feasible reserve prices, each auctioneer announces a reserve price equal to his production cost if the numbers of auctioneers and bidders are sufficiently large, though finite. Our result supports the idea that optimal auctions may be quite simple. Our model also confirms previous results for some “limit” versions of the model by McAfee (Econometrica 61 (1993) 1281–1312), Peters (Rev. Econ. Stud. 64 (1997) 97–123), and Peters and Severinov (J. Econ. Theory 75 (1997) 141–179).

Citation

Hernando-Veciana, Á. (2005). Competition among auctioneers in large markets. Journal of Economic Theory, 121(1), 107-127. https://doi.org/10.1016/j.jet.2004.03.001

Journal Article Type Article
Acceptance Date Mar 11, 2004
Online Publication Date May 28, 2004
Publication Date Mar 1, 2005
Deposit Date Jun 15, 2018
Publicly Available Date Jun 28, 2018
Journal Journal of Economic Theory
Print ISSN 0022-0531
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 121
Issue 1
Pages 107-127
DOI https://doi.org/10.1016/j.jet.2004.03.001
Public URL https://durham-repository.worktribe.com/output/1324060

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