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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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    1. Milgrom,Paul, 2004. "Putting Auction Theory to Work," Cambridge Books, Cambridge University Press, number 9780521536721, September.
    2. Robert Wilson, 1979. "Auctions of Shares," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 93(4), pages 675-689.
    3. 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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