Document Type
Discussion Paper
Publication Date
8-2-2015
CFDP Number
2018R3
CFDP Revision Date
2016-09-01
CFDP Pages
59
Abstract
We explore the impact of private information in sealed-bid first-price auctions. For a given symmetric and arbitrarily correlated prior distribution over values, we characterize the lowest winning-bid distribution that can arise across all information structures and equilibria. The information and equilibrium attaining this minimum leave bidders indifferent between their equilibrium bids and all higher bids. Our results provide lower bounds for bids and revenue with asymmetric distributions over values. We also report further characterizations of revenue and bidder surplus including upper bounds on revenue. Our work has implications for the identification of value distributions from data on winning bids and for the informationally robust comparison of alternative bidding mechanisms.
Recommended Citation
Bergemann, Dirk; Brooks, Benjamin; and Morris, Stephen, "First Price Auctions with General Information Structures: Implications for Bidding and Revenue" (2015). Cowles Foundation Discussion Papers. 2459.
https://elischolar.library.yale.edu/cowles-discussion-paper-series/2459