Bid Regulations in a Multi-unit Uniform Price Auction

Publikation: Working paperForskning

Abstrakt

This paper examines the effect of bid regulations on the range of potential equilibrium prices in a multi-unit uniform price auction with heterogenous bidders. General bid caps destroy equilibria with prices above the bid cap and create new equilibria with prices way below the cap. A cap only for larger rms does not guarantee market prices below that cap. A suffciently high bid floor only for smaller firms destroys some or all pure strategy equilibria despite their prices being above the bid floor. With a general bid floor this happens only with considerably higher bid floors.
OriginalsprogEngelsk
UdgivelsesstedFrederiksberg
UdgiverCopenhagen Business School, CBS
Sider37
StatusUdgivet - 2016
NavnWorking Paper / Department of Economics. Copenhagen Business School
Nummer1-2016

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