On absolute auctions and secret reserve prices

Abstract: From a theory viewpoint, the use of auctions with zero public reserve prices, also called absolute auctions, or of auctions with secret reserve prices, is somewhat puzzling despite being common. By allowing that buyers differ in their processing of past data regarding how the participation rate varies with the auction format and how reserve prices are distributed when secret, we show in a competitive environment that these auction formats may endogenously emerge. We also analyze how buyers with various sophistications and sellers with various costs sort into the different formats, thereby offering a range of testable predictions. Alternative approaches are reviewed.

Keywords: secret; reserve; prices (search for similar items in EconPapers)
Date: 2015-05
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Citations: View citations in EconPapers (13)

Published in RAND Journal of Economics, 2015, 46 (2), pp.241-270. ⟨10.1111/1756-2171.12085⟩

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Related works:
Journal Article: On absolute auctions and secret reserve prices (2015)
Working Paper: On absolute auctions and secret reserve prices (2015)
Working Paper: On absolute auctions and secret reserve prices (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-01155875

DOI: 10.1111/1756-2171.12085

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