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Bidding against an unknown number of competitors sharing affiliated information

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  • Vleugels, Jan

Abstract

In the general symmetric model of Milgrom and Weber, equilibrium bidding is analyzed with a stochastic number of bidders. the equilibrium strategies generalize the known expressions in a coherent way. For the equilibrium bid function of the first price auction, an interpretation involving 'marginal winning probabilities' is proposed. With ageneralized version of the linkage principle, the well-known revenue ranking theorems extend to a stochastic number of bidders. As an application, we show that the seller's generically optimal information policy regarding the number of competitors is concealing the information.

Suggested Citation

  • Vleugels, Jan, 1997. "Bidding against an unknown number of competitors sharing affiliated information," Papers 97-13, Sonderforschungsbreich 504.
    • Handle: RePEc:mnh:spaper:2898
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    File URL: https://madoc.bib.uni-mannheim.de/2898/1/dp97_13.pdf
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    References listed on IDEAS

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    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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