Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2000-06-06
Number: 00-044/1
Author-Name: Jacob K. Goeree
Author-Email: jkg@hss.caltech.edu
Author-Workplace-Name: California Institute of Technology
Author-Name: Theo Offerman
Author-Email: t.j.s.offerman@uva.nl
Author-Workplace-Name: CREED, University of Amsterdam
Title: Competitive Bidding in Auctions with Private and Common Values
Abstract: See the article with the same title in the 'Economic Journal' (2003), 113, 598-614.<p>

The objects for sale in most auctions possess both private and common value elements. This salient feature has not yet been incorporated into a strategic analysis of equilibrium bidding behaviour. This paper reports such an analysis for a stylised model in which bidders receive a private value signal and an independent common value signal. We show that more uncertainty about the common value has a negative effect on efficiency. Information provided by the seller decreases uncertainty, which raises efficiency and seller's revenues. Efficiency and revenues are also higher when more bidders enter the auction.<P>This discussion paper has resulted in a publication in <A href="https://web.ebscohost.com/ehost/detail?vid=4&hid=8&sid=e73baab6-a19b-439c-8821-ae0b0080b101%40sessionmgr10&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=buh&AN=10219878"><I>The Economic Journal</I></A>, 2003, 113(489), 598-613.
Classification-JEL: C72; D44
Keywords: Auctions; inefficiencies; information disclosure; competition
File-Url: https://papers.tinbergen.nl/00044.pdf
File-Format: application/pdf
File-Size: 357825 bytes
Handle: RePEc:tin:wpaper:20000044