Maasland, Emiel; Onderstal, Sander - Fondazione ENI Enrico Mattei (FEEM) - 2003
We study sealed-bid auctions with financial externalities, i.e., auctions in which losers’ utilities depend on how much … the winner pays. In the unique symmetric equilibrium of the first-price sealed-bid auction (FPSB), larger financial … externalities result in lower bids and in a lower expected revenue. The unique symmetric equilibrium of the second-price sealed …