Information acquisition during a Dutch auction

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Title: Information acquisition during a Dutch auction
ISBN: 978-952-462-588-3
Author: Miettinen, Paavo
Organization: Bank of Finland
Series: Bank of Finland Research Discussion Papers
ISSN: 1456-6184
Series year: 2010
Series number: 7/2010
Year of publication: 2010
Publication date: 1.3.2010
Published in: Published in Journal of Economic Theory, Volume 148, Issue 3, May 2013, Pages 1213-1225
DOI: 10.1016/j.jet.2012.09.018
Pages: 30 s.
Keywords: menetelmät; huutokaupat; informaatio; hinnat; mallit;
Abstract: In this paper we consider equilibrium behavior in a Dutch (descending price) auction where the bidders are uninformed of their valuations with probability 1-q and can acquire information about their valuation at a positive cost during the auction. We assume that the information acquisition activity is covert. We characterize the equilibrium behavior in a setting where bidders are ex ante symmetric and have independent private values. We show that, if the number of bidders is large, the Dutch auction produces more revenue than would a first price auction.
Note: lmestynyt myös Journal of Economic Theory 2013 sekä Bank of Finland research discussion papers 8/2012.

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