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...

Intuition suggests that an auction maximizes revenue for the seller; yet empirically, many companies sell their businesses in a negotiation with one buyer. I argue that, when potential buyers are market competitors, an auction may generate lower revenue for the seller. First, in an auction,...

The present study contributes to the ongoing debate on possible costs and benefits of insider trading. We present a novel call auction model with insider information. Our model predicts that more insider information improves informational efficiency of prices, but this comes at the expense of...