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Auctioning horizontally differentiated items
Author(s)
Date Issued
2005-12-08
Date Available
2008-11-24T17:19:12Z
Abstract
This paper analyses strategic market allocation by two auctioneers holding substitutes. It characterizes both the cooperative and competitive outcomes. Under cooperation or competition with close substitutes, bidders are allocated according to the expected total surplus each generates. This market division is efficient if and only if the distribution of bidders' tastes is not skewed. If skewed, reserve prices distort participation towards the least preferred item. For greater degrees of product differentiation competition leads to multiple equilibria. Finally, competition with close substitutes sellers leave participation rents to their weakest bidder. They do not in other cases, whether they compete or cooperate.
Type of Material
Working Paper
Publisher
University College Dublin. School Of Economics
Series
UCD Centre for Economic Research Working Paper Series
WP05/25
Copyright (Published Version)
2005 School Of Economics, University College Dublin
Classification
D43
D44
D82
Subject – LCSH
Auctions--Mathematical models
Competition
Pricing
Language
English
Status of Item
Not peer reviewed
This item is made available under a Creative Commons License
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