This paper derives the origin of Vickrey's second price auction theory, and explains why some auctioneers adopt such method, while most others do not. This paper also confirms that no second-price can help reveal the true demand

Using laboratory experiments, we compare the stability of bidding rings in the English auction and the first-price sealed-bid auction in a heterogeneous-value setting. In both a re-matching condition and a fixed-matching condition, we observe that biddings rings are more stable in the English...

Competition for a prize frequently takes the form of dedicating time toward winning a contest. Those who spend the most time become more likely to obtain the prize. We model this competition as an all-pay auction under incomplete information, and report an experiment in which expenditures and...

This paper studies equilibrium selection in the generalized second price auction, employed by major search engines to sell online advertisement positions. We perturb the baseline model by introducing a bidder whose bid and participation are random (noise bidder). In this model, an efficient...

An auction is externality-robust if unilateral deviations from equilibrium leave the other bidders' payoffs unaffected. The equilibrium and its outcome will then persist if certain types of externalities arise between bidders. One example are externalities due to spiteful preferences, which have...

This paper analyses the incentives to adopt cost-reducing technology by firms in a horizontally differentiated industry. In our model there are several suppliers of a new technology. The extent of the cost reduction depends on the quality of the new technology. A firm has to buy the technology...

This paper studies complete-information, all-pay contests with asymmetric players competing for heterogeneous prizes. In these contests, each player chooses a performance level or "score". The first prize is awarded to the player with the highest score, the second -- less valuable -- prize to...

This note studies contests in which multiple participants compete for two distinct prizes. The participants have distinct constant marginal costs, which are commonly known. We show that the contests have a unique Nash equilibrium, and we characterize the equilibrium payoffs and strategies in...

We introduce a general class of simplicity standards that vary the foresight abilities required of agents in extensive-form games. Rather than planning for the entire future of a game, agents are presumed to be able to plan only for those histories they view as simple from their current...

We introduce a general class of simplicity standards that vary the foresight abilities required of agents in extensive-form games. Rather than planning for the entire future of a game, agents are presumed to be able to plan only for those histories they view as simple from their current...