On the analysis of asymmetric first price auctions

Vlad Mares, Jeroen M. Swinkels*

*Corresponding author for this work

Research output: Contribution to journalArticle

12 Scopus citations

Abstract

We provide new tools for studying asymmetric first price auctions, connecting their equilibria to the ρ-concavity of the underlying type distributions, and showing how one can use surplus expressions for symmetric auctions to bound equilibrium behavior in asymmetric auctions. We apply these tools to studying procurement auctions in which, as is common in practice, one seller is given an advantage, reflecting for example better reliability or quality. We show conditions under which for any given first price handicap auction, there exists a superior second price auction with bonuses.

Original languageEnglish (US)
Pages (from-to)1-40
Number of pages40
JournalJournal of Economic Theory
Volume152
Issue number1
DOIs
StatePublished - Jan 1 2014

Keywords

  • Asymmetric auctions
  • Differentiation
  • First price auctions
  • Mechanism design
  • Procurement
  • Request for proposal
  • Rho-concavity
  • Second price auctions

ASJC Scopus subject areas

  • Economics and Econometrics

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