A Study of First-price Sealed-bid Procurement Auctions for Divisible Items∗
نویسندگان
چکیده
In this paper, we study first-price sealed-bid procurement auctions for divisible items. The auctions are divided into two cases: the auctioneer either does or does not compensate for an oversupply of the quantity purchased. The bidding behaviors of bidders are modeled, and then the optimal bidding strategy for bidders is obtained. It is shown that the bidder’s bidding price exists and is increasing in his cost. Moreover, we show that the bidder can gain more profit in cases where the auctioneer compensates the overage supply quantity.
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