Resale in second-price auctions with costly participation

Gorkem Celik, Okan Yilankaya

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

We study sealed-bid second-price auctions with costly participation and resale. Each bidder chooses to participate in the auction if her valuation is higher than her optimally chosen participation cutoff. If resale is not allowed and the bidder valuations are drawn from a strictly convex distribution function, the symmetric equilibrium (where all bidders use the same cutoff) is less efficient than a class of two-cutoff asymmetric equilibria. Existence of these equilibria without resale is sufficient for existence of similarly constructed two-cutoff equilibria with resale. Moreover, the equilibria with resale are “more asymmetric” and (under a sufficient condition) more efficient than the corresponding equilibria without resale.
Original languageEnglish
Pages (from-to)148-174
Number of pages27
JournalInternational Journal of Industrial Organization
Volume54
DOIs
Publication statusPublished - Sep 1 2017

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Distribution functions
Participation
Second-price auction
Resale

Keywords

  • Endogenous entry
  • Endogenous valuations
  • Participation cost
  • Resale
  • Second-price auctions

Cite this

Resale in second-price auctions with costly participation. / Celik, Gorkem; Yilankaya, Okan.

In: International Journal of Industrial Organization, Vol. 54, 01.09.2017, p. 148-174.

Research output: Contribution to journalArticle

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