Glowicka, Ela and Beck, Jonathan (2006): A note on reserve price commitments in the Vickrey auction.
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This note provides a simple explanation why sellers rarely set optimal reserve prices in one-shot auctions. In a standard sealed-bid second-price auction, bidders with private values do not bid truthfully if the seller cannot commit to her announced reserve price. Consequently, expected revenue may be lower than without the announcement of a reserve price.
|Item Type:||MPRA Paper|
|Original Title:||A note on reserve price commitments in the Vickrey auction|
|Keywords:||Vickrey auction; reserve price; commitment|
|Subjects:||D - Microeconomics > D4 - Market Structure and Pricing > D44 - Auctions
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information; Mechanism Design
|Depositing User:||Jonathan Beck|
|Date Deposited:||10. Jan 2008 06:06|
|Last Modified:||16. Feb 2013 21:12|
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