I study a principal's optimal choice of constraint for an agent participating in an auction (or auction-like allocation mechanism). I give necessary and sufficient conditions on the principal's beliefs about the value of the item for a simple budget constraint to be the optimal contract. The...

Consider a first-price, sealed-bid auction with interdependent valuations and private budget constraints. Focusing on the two-bidder case, we identify new sufficient conditions for the existence of a symmetric equilibrium in pure strategies. In equilibrium, agents may adopt discontinuous bidding...

We consider an environment where potential buyers of an indivisible good have liquidity constraints, in that they cannot pay more than their `budget' regardless of their valuation. A buyer's valuation for the good as well as her budget are her private information. We derive constrained-effcient...

We characterize revenue maximizing mechanisms in a common value environment where the value of the object is equal to the highest of bidders’ independent signals. If the object is optimally sold with probability one, then the optimal mechanism is simply a posted price, with the highest...

We characterize revenue maximizing mechanisms in a common value environment where the value of the object is equal to the highest of bidders' independent signals. The optimal mechanism exhibits either neutral selection, wherein the object is randomly allocated at a price that all bidders are...

For a repeated procurement problem, we compare two stylized negotiating cultures which differ in how the buyer uses an entrant to exert pressure on the incumbent resembling U.S. style and Japanese style procurement. In each period, the suppliers are privately informed about their production...

This paper studies the possibility of implementing Pareto optimal outcomes in the combinatorial auction setting where bidders may have budget constraints. I show that when the setting involves a single good, or multiple goods but with single-minded bidders, there is a unique mechanism, called...

Consider a first-price, sealed-bid auction with interdependent valuations and private budget constraints. Private budget constraints introduce subtle strategic tradeoffs with first-order consequences for equilibrium bidding. In a pure-strategy, symmetric equilibrium, agents may adopt...