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- Title
Coasian dynamics in repeated English auctions.
- Authors
Menezes, Flávio M.; Ryan, Matthew J.
- Abstract
We extend the Coase conjecture to the case of a seller with a single object, who faces n potential buyers and holds a sequence of English auctions until the object is sold. In an independent-private-values environment in which buyers and sellers share the same discount factor, we show that the (perfect Bayesian) equilibrium path of reserve prices obeys a Coasian logic. Moreover, the equilibrium reserve path lies below that for the repeated sealed-bid, second-price auctions studied by McAfee and Vincent (in Games Econ Behav 18:246–276). Nevertheless, the open (English) and sealed-bid formats are shown to be revenue equivalent.
- Subjects
AUCTIONS; COMMERCE; BAILMENTS; REVENUE; AGRICULTURAL prices
- Publication
International Journal of Game Theory, 2009, Vol 38, Issue 3, p349
- ISSN
0020-7276
- Publication type
Article
- DOI
10.1007/s00182-009-0164-7