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Full-Text Articles in Economics
A Suite Deal, Scott J. Wallsten
Vickrey Auctions With Reserve Pricing, Peter Cramton, Lawrence M. Ausubel
Vickrey Auctions With Reserve Pricing, Peter Cramton, Lawrence M. Ausubel
Peter Cramton
We generalize the Vickrey auction to allow for reserve pricing in a multi-unit auction with interdependent values. In the Vickrey auction with reserve pricing, the seller determines the quantity to be made available as a function of the bidders’ reports of private information, and then efficiently allocates this quantity among the bidders. Truthful bidding is a dominant strategy with private values and an ex post equilibrium with interdependent values. If the auction is followed by resale, then truthful bidding remains an equilibrium in the auction-plus-resale game. In settings with perfect resale, the Vickrey auction with reserve pricing maximizes seller revenues.
Auctioning Many Divisible Goods, Peter Cramton, Lawrence M. Ausubel
Auctioning Many Divisible Goods, Peter Cramton, Lawrence M. Ausubel
Peter Cramton
We study the theory and practical implementation of auctioning many divisible goods. With multiple related goods, price discovery is important not only to reduce the winner’s curse, but more importantly, to simplify the bidder’s decision problem and to facilitate the revelation of preferences in the bids. Simultaneous clock auctions are especially desirable formats for auctioning many divisible goods. We examine the properties of these auctions and discuss important practical considerations in applying them.
High Tech Cluster Bombs: Why Successful Biotech Hubs Are The Exception, Not The Rule, Scott J. Wallsten
High Tech Cluster Bombs: Why Successful Biotech Hubs Are The Exception, Not The Rule, Scott J. Wallsten
Scott J. Wallsten
No abstract provided.
Competitive Auction Markets In British Columbia, Peter Cramton, Susan Athey
Competitive Auction Markets In British Columbia, Peter Cramton, Susan Athey
Peter Cramton
US-Canada Softwood Lumber Trade Dispute, On behalf of British Columbia Ministry of Forests.
Optimal Debt With Unobservable Investments, Michael Raith, Paul Povel
Optimal Debt With Unobservable Investments, Michael Raith, Paul Povel
Michael Raith
We study financial contracting when both an entrepreneur’s investment and the resulting revenue are unobservable to an outside investor.We show that a debt contract is always optimal; repayment is induced by a liquidation threat that increases with the extent of default. Moreover, when the entrepreneur’s decision concerns the scale of his project, a contract that minimizes liquidation losses is optimal. When the decision concerns managerial effort or project risk, however, it may be optimal to write a contract with a greater threat of liquidation, to induce the entrepreneur to exert more effort or to choose a less risky project.
Abuse Of Authority And Hierarchical Communication, Guido Friebel, Michael Raith
Abuse Of Authority And Hierarchical Communication, Guido Friebel, Michael Raith
Michael Raith
If managers and their subordinates have the same basic qualifications, organizations can benefit from replacing unproductive superiors with more productive subordinates. This threat may induce superiors to deliberately recruit unproductive subordinates, or abuse their personnel authority in other ways, to protect themselves. We show that requiring intrafirm communication to pass through a “chain of command” can be an effective way to provide superiors with an incentive to recruit the best possible subordinates.We discuss alternative ways to prevent the abuse of authority and general implications of our analysis for organizational design. We also present supporting evidence from the literature on human …
Competitive Bidding Behavior In Uniform-Price Auction Markets, Peter Cramton
Competitive Bidding Behavior In Uniform-Price Auction Markets, Peter Cramton
Peter Cramton
Profit-maximizing bidding in uniform price auction markets involves bidding above marginal cost. It therefore is not surprising that such behavior is observed in electricity markets. This incentive to bid above marginal cost is not the result of coordinated action among the bidders. Rather, each bidder is independently selecting its bid to maximize profits based on its estimate of the residual demand curve it faces. The supplier bids a price for its energy capacity to optimize its marginal tradeoff between higher prices and lower quantities. Price response from either demand or other suppliers prevents the supplier from raising its bid too …
Renewed Interest In Coordinated Effects In Merger Analysis: The Upm Case, David A. Weiskopf, Cleve B. Tyler
Renewed Interest In Coordinated Effects In Merger Analysis: The Upm Case, David A. Weiskopf, Cleve B. Tyler
David A Weiskopf
No abstract provided.