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Uniform price auction with quantity constraints

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  • Kiho Yoon

Abstract

We study the equilibria of uniform price auctions where bidders have flat demands up to their respective quantity constraints. We present an iterative procedure that systematically finds a Nash equilibrium outcome under semi-complete information as well as a novel ascending auction under incomplete information that has this outcome as a dominant strategy equilibrium. Demand reduction and low price equilibrium may occur since it is sometimes advantageous for a bidder to give up some of his/her demand and get the remaining demand at a low price rather than to get his/her entire demand at a higher price.

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  • Kiho Yoon, 2024. "Uniform price auction with quantity constraints," Papers 2409.04047, arXiv.org.
    • Handle: RePEc:arx:papers:2409.04047
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    References listed on IDEAS

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    1. Milgrom,Paul, 2004. "Putting Auction Theory to Work," Cambridge Books, Cambridge University Press, number 9780521536721, January.
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    4. Noussair, Charles, 1995. "Equilibria in a Multi-object Uniform Price Sealed Bid Auction with Multi-unit Demands," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 5(2), pages 337-351, March.
    5. Back, Kerry & Zender, Jaime F, 1993. "Auctions of Divisible Goods: On the Rationale for the Treasury Experiment," The Review of Financial Studies, Society for Financial Studies, vol. 6(4), pages 733-764.
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