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Título:
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The Complete Information First. Price Auction or the Importance of Being Indivisible
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Autor/a:
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Alcalde, José; Dahm, Matthias
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Otros autores:
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Universitat Rovira i Virgili. Departament d'Economia |
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Resum:
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Abstract
Despite the popularity of auction theoretical thinking, it appears that no one has
presented an elementary equilibrium analysis of the first-price sealed-bid auction
mechanism under complete information. This paper aims to remedy that omission.
We show that the existence of pure strategy undominated Nash equilibria requires
that the bidding space is not "too divisible" (that is, a continuum). In fact, when
bids must form part of a finite grid there always exists a "high price equilibrium".
However, there might also be "low price equilibria" and when the bidding space
is very restrictive the revenue obtained in these "low price equilibria" might be
very low. We discuss the properties of the equilibria and an application of auction
theoretical thinking in which "low price equilibria" may be relevant.
Keywords: First-price auctions, undominated Nash equilibria.
JEL Classification Numbers:
C72 (Noncooperative Games),
D44 (Auctions). |
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Fecha de creación:
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2008 |
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Materias (CDU):
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338 - Situació econòmica. Política econòmica. Gestió, control i planificació de l'economia. Producció. Serveis. Turisme. Preus |
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Materia(s):
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Jocs, Teoria de
Preus -- Fixació
Equilibri (Economia)
Nash, Varietats de |
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Derechos:
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Aquest document està subjecte a una llicència d'ús de Creative Commons, amb la qual es permet copiar, distribuir i comunicar públicament l'obra sempre que se'n citin l'autor original, la universitat i el departament i no se'n faci cap ús comercial ni obra derivada, tal com queda estipulat en la llicència d'ús (http://creativecommons.org/licenses/by-nc-nd/2.5/es/) |
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Tipo de documento:
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Documento de trabajo |
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ISSN:
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1988 - 0812
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Collection:
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Documents de treball del Departament d'Economia;2008-11
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