Multi-unit auctions: A comparison of static and dynamic mechanisms

We compare, experimentally, the Vickrey auction and an ascending-price auction introduced by Ausubel [Ausubel, L.M., 2004. An efficient ascending-bid auction for multiple objects. American Economic Review 94, 1452–1475], evaluating their performances in multi-unit environments where valuations eithe...

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Bibliographic Details
Published in:Journal of economic behavior & organization 2006-10, Vol.61 (2), p.304-323
Main Authors: Manelli, Alejandro M., Sefton, Martin, Wilner, Benjamin S.
Format: Article
Language:English
Subjects:
Auctions
Bids
Economic analysis
Economic behaviour
Experiments
Multi-unit auctions
Studies
Tradeoff analysis
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Summary:We compare, experimentally, the Vickrey auction and an ascending-price auction introduced by Ausubel [Ausubel, L.M., 2004. An efficient ascending-bid auction for multiple objects. American Economic Review 94, 1452–1475], evaluating their performances in multi-unit environments where valuations either have a common-value component or are private information. We observe substantial overbidding, particularly in the Vickrey auction, and find that revenue is higher in the Vickrey auction and efficiency is similar in both auctions. In a further experiment, using slightly different versions that focuses on the common-value component, we observe less overbidding and an apparent trade-off between revenue and efficiency: the Vickrey auction is more efficient while revenues are higher in the Ausubel auction.
ISSN:0167-2681
1879-1751
DOI:10.1016/j.jebo.2005.04.014