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Reputational bidding

Giovannoni, Francesco, Makris, Miltiadis (2014) Reputational bidding. International Economic Review, 55 (3). pp. 693-710. ISSN 1468-2354. (doi:10.1111/iere.12067)

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https://doi.org/10.1111/iere.12067

Abstract

We consider auctions where bidders care about the reputational effects of their bidding and argue that the amount of information disclosed at the end of the auction will influence bidding. We focus on bid disclosure rules that capture all of the realistic cases. We show that bidders distort their bidding in a way that conforms to stylized facts about takeovers/licence auctions. We rank the disclosure rules in terms of their expected revenues and find that, under certain conditions, full disclosure will not be optimal. First-price and second-price auctions with price disclosure are not revenue equivalent and we rank them.

Item Type: Article
DOI/Identification number: 10.1111/iere.12067
Uncontrolled keywords: auctions, signalling, disclosure
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HG Finance
Divisions: Faculties > Social Sciences > School of Economics
Depositing User: Miltos Makris
Date Deposited: 18 Oct 2018 11:15 UTC
Last Modified: 29 May 2019 21:18 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/69625 (The current URI for this page, for reference purposes)
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