Auctions, Actions, and the Failure of Information Aggregation

S-Tier
Journal: American Economic Review
Year: 2014
Volume: 104
Issue: 7
Pages: 2014-48

Score contribution per author:

4.022 = (α=2.01 / 2 authors) × 4.0x S-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We study a uniform-price auction where k identical common-value objects are allocated amongst z > k bidders who have imperfect signals about the state of the world. The common valuation is determined jointly by the state and an action that is chosen after winning an object. In large auctions, there are symmetric equilibria where the auction price aggregates no information. Moreover, market statistics other than price (e.g., the amount of rationing or the bid distribution) contain extra information about the state. In contrast, in standard large auctions without actions, the price aggregates all relevant information.

Technical Details

RePEc Handle
repec:aea:aecrev:v:104:y:2014:i:7:p:2014-48
Journal Field
General
Author Count
2
Added to Database
2026-01-24