Price Regulations in a Multi-unit Uniform Price Auction

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Abstract

Inspired by recent regulations in the New York ICAP market we examine the effect of different price regulations on a multi-unit uniform price auction. We investigate a bid cap and a bid foor. Given suffciently high total capacities general bid caps always ensure that the market price does not exceed the price cap whereas a selective bid cap for only the larger firms, does not guarantee this outcome. A sufficiently high bid floor always destroys pure strategy equilibria with equilibrium prices above the marginal costs, no matter whether the floor applies to all or only to relatively small firms.
Original languageEnglish
Publication date2014
Number of pages27
Publication statusPublished - 2014
EventThe 12th Annual International Industrial Organization Conference. IIOC 2014 - Northwestern Law Searle Center on Law, Regulation and Economic Growth, Chicago, IL, United States
Duration: 11 Apr 201413 Apr 2014
Conference number: 12
http://editorialexpress.com/conference/IIOC2014/program/IIOC2014.html

Conference

ConferenceThe 12th Annual International Industrial Organization Conference. IIOC 2014
Number12
LocationNorthwestern Law Searle Center on Law, Regulation and Economic Growth
CountryUnited States
CityChicago, IL
Period11/04/201413/04/2014
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Cite this

Boom, A. (2014). Price Regulations in a Multi-unit Uniform Price Auction. Paper presented at The 12th Annual International Industrial Organization Conference. IIOC 2014, Chicago, IL, United States.