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- Title
Vickrey auctions with reserve pricing.
- Authors
Ausubel, Lawrence M.; Cramton, Peter
- Abstract
We generalize the Vickrey auction to allow for reserve pricing in a multi-unit auction with interdependent values. In the Vickrey auction with reserve pricing, the seller determines the quantity to be made available as a function of the bidders' reports of private information, and then efficiently allocates this quantity among the bidders. Truthful bidding is a dominant strategy with private values and an ex post equilibrium with interdependent values. If the auction is followed by resale, then truthful bidding remains an equilibrium in the auction-plus-resale game. In settings with perfect resale, the Vickrey auction with reserve pricing maximizes seller revenues.
- Subjects
AUCTIONS; PRICING; BIDDERS; RESALE; ECONOMIC equilibrium; REVENUE
- Publication
Economic Theory, 2004, Vol 23, Issue 3, p493
- ISSN
0938-2259
- Publication type
Article
- DOI
10.1007/s00199-003-0398-8