Optimal auction design under non-commitment

A-Tier
Journal: Journal of Economic Theory
Year: 2015
Volume: 159
Issue: PB
Pages: 854-890

Score contribution per author:

4.022 = (α=2.01 / 1 authors) × 2.0x A-tier

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

Abstract

We characterize revenue-maximizing mechanisms in Myerson's (1981) environment when the seller behaves sequentially rationally, in the sense that she cannot commit not to propose a new mechanism if the previously chosen one fails to allocate the object. We show that the seller-optimal mechanism takes the same form as in the case when there is commitment: The seller maximizes revenue by assigning, at t=1, the good to the buyer with the highest virtual valuation if it is above a buyer-specific reserve price. If no trade takes place at t=1, at t=2, the seller assigns the object to the buyer with the highest posterior virtual valuation, provided that it is above the seller's value.

Technical Details

RePEc Handle
repec:eee:jetheo:v:159:y:2015:i:pb:p:854-890
Journal Field
Theory
Author Count
1
Added to Database
2026-01-29