Regulating bidder participation in auctions
type="main"> <p>Regulating bidder participation in auctions can potentially increase efficiency compared to standard auction formats with free entry. We show that the relative performance of two such mechanisms, a standard first-price auction with free entry and an entry rights auction, depends nonmonotonically on the precision of information that bidders have about their costs prior to deciding whether to participate in a mechanism. As an empirical application, we estimate parameters from first-price auctions with free entry for bridge-building contracts in Oklahoma and Texas and predict that an entry rights auction increases efficiency and reduces procurement costs significantly.
Year of publication: |
2014
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Authors: | Bhattacharya, Vivek ; Roberts, James W. ; Sweeting, Andrew |
Published in: |
RAND Journal of Economics. - RAND, ISSN 0741-6261. - Vol. 45.2014, 4, p. 675-704
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Publisher: |
RAND |
Saved in:
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