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Entry in First-price Auctions with Signaling

Author

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  • BOS, Olivier
  • TRUYTS, Tom

    (Université catholique de Louvain, CORE, Belgium)

Abstract

We study the optimal entry fee in a symmetric private value first-price auction with signaling, in which the participation decisions and the auction outcome are used by an outside observer to infer the bidders’ types. We show that this auction has a unique fully separating equilibrium bidding function. The expected revenue maximizing entry fee is the maximal fee that guarantees full participation.

Suggested Citation

  • BOS, Olivier & TRUYTS, Tom, 2016. "Entry in First-price Auctions with Signaling," LIDAM Discussion Papers CORE 2016017, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:2016017
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    References listed on IDEAS

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    Cited by:

    1. Wang, Dazhong & Xu, Xinyi & Zeng, Xianjie, 2023. "Comparisons of standard royalty auctions with seller post-auction effort," Journal of Mathematical Economics, Elsevier, vol. 107(C).

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    More about this item

    Keywords

    Monotonic signaling; social status; first-price auction; entry;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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