Ranking Asymmetric Auctions using the Dispersive Order
نویسنده
چکیده
The revenue ranking of asymmetric auctions with two heterogenous bidders is examined. The main theorem identi es a general environment in which the rst-price auction is more pro table than the second-price auction. By using mechanism design techniques, the problem is simpli ed and several extensions are made possible. Roughly speaking, the rst-price auction is more pro table when the strong bidders distribution is atter and more disperse than the weak bidders distribution. These su¢ cient conditions turn out to have appealing geometric and economic interpretations. The theorem applies to certain environments with multi-dimensional types. It is also possible, for the rst time, to extend the ranking to auctions with reserve prices and to auctions with more bidders. Implications for contests architecture and other auction formats are also pursued. JEL Classi cation Numbers: D44, D82.
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