Bertoletti, Paolo (2006): On the reserve price in all-pay auctions with complete information and lobbying games.
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We show that the seller’s optimal reserve price in an all-pay auction with complete information is higher than in a standard auction. We use our results to re-consider some findings of the literature that models lobbying games as all-pay auctions. In particular, we show that the so-called Exclusion Principle appears to rely crucially on the implicit assumption of a “weak” (in terms of bargaining power) seller, and does not hold if she regards bidders’ valuations as iid according to a monotonic hazard rate. Our preliminary results for the case of independent but asymmetric bidders make it even more suspicious.
|Item Type:||MPRA Paper|
|Institution:||Dipartimento di Economia Politica e Metodi quantitativi, University of Pavia|
|Original Title:||On the reserve price in all-pay auctions with complete information and lobbying games|
|Keywords:||all-pay auctions; reserve price; economic theory of lobbying|
|Subjects:||D - Microeconomics > D4 - Market Structure and Pricing > D44 - Auctions
D - Microeconomics > D7 - Analysis of Collective Decision-Making > D72 - Political Processes: Rent-Seeking, Lobbying, Elections, Legislatures, and Voting Behavior
|Depositing User:||Paolo Bertoletti|
|Date Deposited:||07. Dec 2006|
|Last Modified:||13. Feb 2013 14:14|
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