Kirkegaard, René; Overgaard, Per Baltzer - School of Economics and Management, University of Aarhus - 2005
favor the weak buyer. However, we show that the seller can do one better by augmenting the first-price auction by a pre-auction … ordinary first-price auction. The result is driven by the fact that the unmodified first-price auction is too favorable to the … weak buyer, and that the pre-auction offer allows some correction of this to the benefit of the seller. Secondly, we show …