We analyse bidding behaviour in auctions when risk-averse buyers bid for a good whose value is risky. We show that when … risk in the valuations increases, DARA bidders will reduce their bids by more than the appropriate increase in the risk … marginal utility of income increases with risk, so buyers are reluctant to bid so highly. We also show that precautionary …

between the bidders? valuation. We consider risk neutral bidders who compete for the control of a target firm in which they …. Particularly, we found that if a potential bidder overbids when he gets toeholds in the target firm, the extent of overbidding is …

policies. While academic research has largely dismissed the procedure owing to its tendency to encourage overbidding, central … an auction-theoretic setting with private information about declining marginal valuations. Since overbidding entails … exposure risk, an equilibrium may exist even if bids are costless and the intended volume is pre-announced. In fact, the …

bid exceeds the private valuation of the bank’s coalition partner (overbidding). We derive new and testable cross …-sectional predictions of the overbidding theory, and provide empirical support using auction premiums as dependent variable. Interestingly …

the liquidation recovery and the final going-concern auction premium are observable, the overbidding theory is testable …. We perform a large-sample, cross-sectional analysis where overbidding is pitched against asset fire-sale arguments. The … overbidding but provides little support for asset fire-sale arguments. …

equilibrium than others. Since deviations take mostly the form of overbidding, these subjects win the first or second good and …

large capacity constraints mitigate the overbidding that plagues single-unit auctions and is one of the most robust …

English premium auction (EPA) for different risk attitudes of bidders. We explicitly derive the symmetric equilibrium for … are sorted into risk-averse and risk-loving groups. We find that revenues in the EPA are significantly higher when bidders … are risk loving rather than risk averse. These results are partly consistent with theory and confirm the general view that …