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Disclosure policies in all-pay auctions with affiliated values

Author

Listed:
  • Chen, Bo
  • Serena, Marco
  • Wang, Zijia

Abstract

We consider all-pay auctions with private and affiliated binary values. The organizer commits ex ante to fully disclosing or concealing bidders’ valuations. We examine the effects of full disclosure on bidders’ welfare and the organizer’s revenue (i.e., expected aggregate bid). We find that full disclosure, as opposed to full concealment, always yields a higher welfare for bidders. On the other hand, full concealment yields a higher revenue if the affiliation in bidders’ valuations is low or if there are only two bidders. Conversely, if the affiliation is high and there are sufficiently many bidders, full disclosure tends to increase revenue.

Suggested Citation

  • Chen, Bo & Serena, Marco & Wang, Zijia, 2024. "Disclosure policies in all-pay auctions with affiliated values," Economic Modelling, Elsevier, vol. 141(C).
    • Handle: RePEc:eee:ecmode:v:141:y:2024:i:c:s026499932400227x
    DOI: 10.1016/j.econmod.2024.106870
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    More about this item

    Keywords

    All-pay auction; Affiliated values; Disclosure policy; Stochastic entry;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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