Tian, Guoqiang and Xiao, Mingjun (2009): Vickrey Auctions with Sequential and Costly Participation.
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This paper investigates the cutoff strategies and the effects of sequential and costly participation in Vickrey auctions with independent private value settings. It demonstrates a Stackelberg version of participation decision in auctions, while simultaneous participation can be regarded as a Cournot version in auctions. Buyers adopt cut-off participation strategies. In two-buyer case, the cutoff strategy equilibrium is unique. The follower's critical values are always monotonic in participation cost in both symmetric and asymmetric settings. This is also true for the leader with mild conditions on c.d.fs. We also characterize equilibria in three-buyer and more general n-buyer environments. We then study buyer's preference to be a leader or a follower. Comparison with simultaneous model shows that the driven-out effect is much stronger in our sequential participation model, which implies the simultaneous specification might not be desirable.
|Item Type:||MPRA Paper|
|Original Title:||Vickrey Auctions with Sequential and Costly Participation|
|Keywords:||Sequential Participation, Participation Cost, Second Price Auction|
|Subjects:||D - Microeconomics > D4 - Market Structure and Pricing > D44 - Auctions
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D80 - General
C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C72 - Noncooperative Games
|Depositing User:||Guoqiang Tian|
|Date Deposited:||12. Sep 2012 12:49|
|Last Modified:||27. Feb 2013 05:10|
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