We develop a theoretical analysis of the choice of firms between fixed-price offerings and uniform-price auctions for selling shares in IPOs and privatizations. We consider a setting in which a firm goes public by selling a fraction of its equity in an IPO market where insiders have private...

In this paper, we empirically identify rational overbidding using evidence from Hong Kong land auctions. In particular, we test for rational overbidding through a toehold effect in bidding behavior (Burkart (1995), Bulow, Huang and Klemperer, (1999)). In Hong Kong, auctions are widely used by...

In an auction with a buy price, the seller provides bidders with an option to end the auction early by accepting a transaction at a posted price. The Buy-It-Now option on eBay is a leading example of an auction with a buy price. This paper develops a model of an auction with a buy price in which...

How much information does an auctioneer want bidders to have in a private value environment? We address this question using a novel approach to ordering information structures based on the property that in private value settings more information leads to a more disperse distribution of buyers'...

We consider two private-value auctions where the prize in one is higher than the prize in the other. We show that a separating equilibrium exists where bidders with a high valuation attend the auction with the higher prize while the weak bidders attend the auction with the lower prize. In...

We consider situations where a society allocates a finite units of an indivisible good among agents, and each agent receives at most one unit of the good. For example, imagine that a government allocates a fixed number of licences to private firms, or imagine that a government distributes...

This note studies the allocation of heterogeneous commodities to agents whose private values for combinations of these commodities are monotonic by inclusion. This setting can accommodate the presence of complementarity and substitutability among the heterogeneous commodities. By using induction...

Behavioral Finance argues that several anomalies could be explained by relaxing the central proposition of EMH (Efficient Market Hypothesis), that is, investors' rationality. Indeed, recent empirical and experimental work provides additional evidence that human judgment errors may impact...

Cost allocations have befuddled managers around the world for over a century. The need for objective, actionable cost accounting data is frustrated not just by the difficult theoretical issues in distinguishing among various classes of cost, but also by informational asymmetries and agency...