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Nonparametric Identification and Estimation of Multi-Unit, Sequential, Oral, Ascending-Price Auctions with Asymmetric Bidders

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  • Harry J. Paarsch
  • Bjarne Brendstrup

Abstract

Within the independent private-values paradigm, we derive the data-generating process of the winning bid for the last unit sold at sequential English auctions when bidder valuations are draws from one of several different classes of distributions; i.e., in the presence of asymmetries. When the identify of the winner as well as the number of units won by each bidder in previous stages of the auction are observed, we demonstrate nonparametric identification, and then propose two estimation strategies, one based on the empirical distribution function of winning bids for the last unit sold and the other based on Laguerre polynomials. Subsequently, we apply our method to data from fish auctions held in Grenaa, Denmark. For single-unit supply, we use our estimates to compare the revenues a seller could expect to earn were a Dutch auction employed instead

Suggested Citation

  • Harry J. Paarsch & Bjarne Brendstrup, 2004. "Nonparametric Identification and Estimation of Multi-Unit, Sequential, Oral, Ascending-Price Auctions with Asymmetric Bidders," Econometric Society 2004 North American Winter Meetings 149, Econometric Society.
    • Handle: RePEc:ecm:nawm04:149
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    1. Emmanuel Guerre & Isabelle Perrigne & Quang Vuong, 2000. "Optimal Nonparametric Estimation of First-Price Auctions," Econometrica, Econometric Society, vol. 68(3), pages 525-574, May.
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    Cited by:

    1. Susan Athey & Jonathan Levin & Enrique Seira, 2004. "Comparing Open and Sealed Bid Auctions: Theory and Evidence from Timber Auctions," Levine's Bibliography 122247000000000524, UCLA Department of Economics.
    2. Harry J. Paarsch & Bjarne Brendstrup, 2004. "Nonparametric Estimation of Dutch and First-Price, Sealed-Bid Auction Models with Asymmetric Bidders," Econometric Society 2004 North American Summer Meetings 39, Econometric Society.

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    More about this item

    Keywords

    asymmetric; multi-unit; sequential; English fish auctions; Dutch auctions; semi-nonparametric estimation;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery

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