[ Article ]
Seoul Journal of Economics - Vol. 29, No. 2, pp.151-163
ISSN: 1225-0279
(Print)
Print publication date 30 May 2016
Received 15 Dec 2015
Revised 05 Jan 2016
Accepted 25 Feb 2016
Interdependent Value Auctions with an Insider Bidder
Jinwoo Kim
JEL Classification: C92, D44, D82
Abstract
We study the efficiency of standard auctions with interdependent values in which one of two bidders is perfectly informed of his value while the other is partially informed. The second-price auction, as well as English auction, has a unique ex-post equilibrium that yields efficient allocation. By contrast, the first-price auction has no efficient equilibrium.
Keywords:
Interdependent value, Insider, Second-price auction, First-price auctionAcknowledgments
This work was supported by the National Research Foundation of Korea Grant funded by the Korean Government (NRF-2014S1A5A2A03065638).
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