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Inverse Adverse Selection: The Market for Gems

Dari-Mattiacci, Giuseppe; Onderstal, Sander; Parisi, … - 2011

This paper studies markets plagued with asymmetric information on the quality of traded goods. In Akerlof's setting, sellers are better informed than buyers. In contrast, we examine cases where buyers are better informed than sellers. This creates an inverse adverse selection problem: The market...

Persistent link: https://www.econbiz.de/10010325638

Balanced Unit Prices, the Case for Split Award Unit-Price Auctions

Renes, Sander - 2012

distorted to take advantage of estimation errors. This paper shows that if the unit-price auction is used to select several …

Persistent link: https://www.econbiz.de/10013115145

Why Are Open Ascending Auctions Popular? The Role of Information Aggregation and Behavioral Biases

Offerman, Theo; Romagnoli, Giorgia; Ziegler, Andreas - 2020

The popularity of open ascending auctions is often attributed to the fact that openly observable bidding allows to aggregate dispersed information. Another reason behind the frequent utilization of open auction formats may be that they activate revenue enhancing biases. In an experiment, we...

Persistent link: https://www.econbiz.de/10014352203

White Knights and the Corporate Governance of Hostile Takeovers

Calcagno, Riccardo; Falconieri, Sonia - 2008

We analyze the dynamics of takeover contests where hostile raiders compete against white knights involved by a lead … to set a minimum takeover price. We characterize the conditions under which a white knight wins the takeover contest … white knights as an anti-takeover device and the role played by leading minority blockholders in the market for corporate …

Persistent link: https://www.econbiz.de/10010325684

Mergers in Bidding Markets

Janssen, Maarten; Karamychev, Vladimir - 2013

We analyze the effects of mergers in first-price sealed-bid auctions on bidders' equilibrium bidding functions and on revenue. We also study the incentives of bidders to merge given the private information they have. We develop two models, depending on how after-merger valuations are created. In...

Persistent link: https://www.econbiz.de/10010326240

Countries of a Feather Flock Together - Mergers and Acquisitions in the Global Economy

Garita, Gus; van Marrewijk, Charles - 2008

We analyze the economic forces underlying cross-border Mergers and Acquisitions (M&As) using a large bilateral panel data set. The frequent occurrence of zero observations provides essential information on the structure of M&A flows, which we model empirically using a two-stage procedure. At the...

Persistent link: https://www.econbiz.de/10014216583

Acquisitions as a Real Options Bidding Game

Smit, Han T.J.; van den Berg, Ward A.; Maeseneire, Wouter De - 2004

This paper uses a unified treatment of real options and game theory to examine value appropriation in takeovers within a competitive environment of imperfect information. The integrated model considers a potential target as a shared real option on a bundle of resources. Competing potential...

Persistent link: https://www.econbiz.de/10010325204

Corporate acquisitions and bank relationships

Volosovych, Vadym; Poelhekke, Steven; Vlahu, Razvan - 2021

Using a large dataset of firm-bank and ownership information for 23 European countries over 2008-2015, we study the dynamics of bank relationships after corporate acquisitions and the effects of changing banks on firm performance. Foreign acquirers do not rely on internal capital markets but...

Persistent link: https://www.econbiz.de/10012797240

Acquisitions as a Real Options Bidding Game

Smit, Han T. J. - 2007

This paper uses a unified treatment of real options and game theory to examine the occurrence of bidding contests within a competitive environment of imperfect information and asymmetric bidders. Competing potential buyers may sequentially perform due diligence and incur costs (option premium)...

Persistent link: https://www.econbiz.de/10012732234

Dynamic Insurance and Adverse Selection

Janssen, Maarten C.W.; Karamychev, Vladimir A. - 2001

We take a dynamic perspective on insurance markets under adverseselection and study a generalized Rothschildand Stiglitz model where agents may differ with respect to theaccidental probability and their expenditure levels incase an accident occurs. We investigate the nature of dynamicinsurance...

Persistent link: https://www.econbiz.de/10010324841