Abstract
In this paper I consider a common value model, with independent types, where the ex-post value of the good is influenced by the bidders' information at the auction stage. The seller cannot fully extract the surplus. In a symmetric model the optimal mechanism can be implemented through first price, second price, or English auctions; but not through a Dutch auction. Other properties of the optimal auctions are that the seller's reservation price is endogenous, and that in sealed bid auctions the price may exceed the value of the object (winner's curse).
Original language | English |
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Pages (from-to) | 283-309 |
Number of pages | 27 |
Journal | Review of Economic Design |
Volume | 2 |
Issue number | 1 |
DOIs | |
Publication status | Published - 1996 |
Keywords
- Common values
- Rent extraction
- Standard auctions