Munich Personal RePEc Archive

Wars of attrition and all-pay auctions with stochastic competition

Bos, Olivier (2011): Wars of attrition and all-pay auctions with stochastic competition.

[img]
Preview
PDF
MPRA_paper_34810.pdf

Download (456Kb) | Preview

Abstract

We extend the war of attrition and all-pay auction analysis of Krishna and Morgan (1997) to a stochastic competition setting. We determine the existence of equilibrium bidding strategies and discuss the potential shape of these strategies. Results for the war of attrition contrast with the characterization of the bidding equilibrium strategies in the first-price all-pay auction as well as the winner-pay auctions. Furthermore we investigate the expected revenue comparisons among the war of attrition, the all-pay auction and the winner-pay auctions and discuss the Linkage Principle as well. Our findings are applicable to future works on contests and charity auctions.

UB_LMU-Logo
MPRA is a RePEc service hosted by
the Munich University Library in Germany.