Bilateral k+1-price auctions with asymmetric shares and values

B-Tier
Journal: Games and Economic Behavior
Year: 2013
Volume: 82
Issue: C
Pages: 350-368

Score contribution per author:

2.011 = (α=2.01 / 1 authors) × 1.0x B-tier

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

Abstract

We study a sealed-bid auction between two bidders with asymmetric independent private values. The two bidders own asymmetric shares in a partnership. The higher bidder buys the lower bidderʼs shares at a per-unit price that is a convex combination of the two bids. The weight of the lower bid is denoted by k∈[0,1]. We partially characterize equilibrium strategies and show that they are closely related to equilibrium strategies of two well-studied mechanisms: the double auction between a buyer and a seller and the first-price auction between two buyers (or two sellers). Combining results from those two branches of the literature enables us to prove equilibrium existence. Moreover, we find that there is a continuum of equilibria if k∈(0,1) whereas the equilibrium is unique if k∈{0,1}. Our approach also suggests a procedure for numerical simulations.

Technical Details

RePEc Handle
repec:eee:gamebe:v:82:y:2013:i:c:p:350-368
Journal Field
Theory
Author Count
1
Added to Database
2026-01-29