Treasuries all over the world sell sovereign bonds through an auction which is typically conducted by the central bank. When volatility in financial markets is high, auctions may fail to elicit the true price of the bond. To study the impact of increased uncertainty on bidder behavior in...

We consider all-pay auctions in the presence of interdependent, affiliated valuations and private budget constraints. For the sealed-bid, all-pay auction we characterize a symmetric equilibrium in continuous strategies for the case of N bidders. Budget constraints encourage more aggressive...