Portuguese Economic Journal

, Volume 8, Issue 1, pp 3–14 | Cite as

Revenues in discrete multi-unit, common value auctions: a study of three sealed-bid mechanisms

Original Article


This paper proposes a discrete bidding model for both quantities and pricing. It has a two-unit demand environment where subjects bid for contracts with an unknown redemption value, common to all bidders. Prior to bidding, the bidders receive private signals of information on the (common) value. The relevant task is to compare the equilibrium strategies and the seller’s revenue of the three most common auction formats with two players. The result is that the Vickrey auction always gives the most revenue to the seller, the discriminatory auction follows closely and the uniform auction clearly is the worst due to demand reduction.


Multi-Unit auction Common value auction Discrete auction Game theory 

JEL Classifications

C72 D44 


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Copyright information

© Springer-Verlag 2009

Authors and Affiliations

  1. 1.VTIStockholmSweden

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