Auctions with below-bid pricing (e.g., uniform-price, and ascending auctions) have remarkable theoretical properties, but practitioners are skeptical about their implementation. The authors present a dynamic model of collusion in multiunit auctions that explains this gap between theory and practice. To sustain collusion at the reserve price, bidders submit crank-handle bids. The cost of sustaining crank-handle collusion depends on the degree of below-bid pricing in the auction. Their model predicts that crank-handle collusion is easier to sustain in auctions with more below-bid pricing and when bidders are more symmetric. Evidence from auctions of fishing quota in the Faroe Islands supports our predictions.

Speaker

Alexander Teytelboym

University of Oxford, United Kingdom

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The seminar presentations are scheduled to last 60 minutes: 45 minutes of presentation and 15 minutes for both comments and questions.

We will experiment with various methods for questions: A moderator collects questions during the presentation. Speakers will be encouraged to pause every few slides to allow a gap for questions. The moderator will relay clarification questions or unmute selectively during the talk. Remaining questions will be collected and asked in the discussion period.

Just like with other initiated virtual seminars, these rules are subject to change as we gain experience with how to handle the seminar most efficiently.

The idea for this format was borrowed from the Chamberlain Seminar. Other online seminars can be found at the AEA website.

The Virtual Market Design Seminar is an open online alternative to seminars cancelled due to the COVID-19. Seminars will cover all fields from market design. The seminar presentations are scheduled to last 60 minutes, after 45 minutes of presentation, 15 minutes are for both comments and question.

Date

28.03.2022 | 16:00 - 17:00 (CET)

Event Location

Online


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