Review of Economic Design

, Volume 9, Issue 2, pp 127–143

Implementation of the revenue-maximizing auction by an ignorant seller

Article

Abstract.

In a general auction framework with independent private values, we propose a game, with a simple economic interpretation, that allows to implement the revenue-maximizing auction outcome when the seller ignores the distributions of the different bidders’ valuations. In this detail-free implementation procedure, an ascending-price contest is organized and the winner volunteers a payment to the seller; this payment can then be challenged by another bidder who knows the distribution of the winner’s valuation.

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Copyright information

© Springer-Verlag Berlin/Heidelberg 2005

Authors and Affiliations

  1. 1.PSE (Paris-Jourdan Sciences Economiquesjoint research unit CNRS - EHESS - ENPC - ENS)ParisFrance
  2. 2.CEPRLondonUK
  3. 3.Department of Information TechnologyHEC MontréalCanada
  4. 4.CIRANOCanada

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