Artikel
Auction design without quasilinear preferences
I study the canonical private value auction model for a single good without the quasilinearity restriction. I assume only that bidders are risk averse and the indivisible good for sale is a normal good. I show that removing quasilinearity leads to qualitatively different solutions to the auction design problem. Expected revenue is no longer maximized using standard auctions that allocate the good to the highest bidder. Instead, the auctioneer better exploits bidder preferences by using a mechanism that allocates the good to one of many different bidders, each with strictly positive probability. I introduce a probability demand mechanism that treats probabilities of winning the indivisible good like a d ivisible good in net supply 1. With enough bidders, it has greater expected revenues than any standard auction, and under complete information, it implements a Pareto efficient allocation.
- Sprache
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Englisch
- Erschienen in
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Journal: Theoretical Economics ; ISSN: 1555-7561 ; Volume: 12 ; Year: 2017 ; Issue: 1 ; Pages: 53-78 ; New Haven, CT: The Econometric Society
- Klassifikation
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Wirtschaft
Game Theory and Bargaining Theory: General
Auctions
Asymmetric and Private Information; Mechanism Design
- Thema
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Auctions
multidimensional mechanism design
risk aversion
wealth effects
- Ereignis
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Geistige Schöpfung
- (wer)
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Baisa, Brian
- Ereignis
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Veröffentlichung
- (wer)
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The Econometric Society
- (wo)
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New Haven, CT
- (wann)
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2017
- DOI
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doi:10.3982/TE1951
- Handle
- Letzte Aktualisierung
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10.03.2025, 11:42 MEZ
Datenpartner
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Objekttyp
- Artikel
Beteiligte
- Baisa, Brian
- The Econometric Society
Entstanden
- 2017
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