The insider's curse

نویسندگان

  • Ángel Hernando-Veciana
  • Michael Tröge
چکیده

This paper studies an auction model in which one of the bidders, the insider, has better information about a common component of the value of the good for sale, than the other bidders, the outsiders. Our main result shows that the insider may have incentives to disclose her private information if she faces sufficiently strong competition from the outsiders. We also show that the insider can protect the value of her private information if she may hide her presence in the auction to the outsiders. Finally, we analyze the implications of information revelation on the efficiency of the auction and on the auctioneer’s expected revenue. JEL Classification Numbers: D41, D44, D82.

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عنوان ژورنال:
  • Games and Economic Behavior

دوره 71  شماره 

صفحات  -

تاریخ انتشار 2011