Computational Economics

, Volume 12, Issue 1, pp 61–78 | Cite as

Computationally Convenient Distributional Assumptions for Common-Value Auctions

  • Michael B. Gordy
Article

Abstract

Although the mathematical foundations of common-value auctions have been well understood since Milgrom and Weber (1982), equilibrium bidding strategies are computationally complex. Very few calculated examples can be found in the literature, and only for highly specialized cases. This paper introduces two sets of distributional assumptions that are flexible enough for theoretical and empirical applications, yet permit straightforward calculation of equilibrium bidding strategies.

common-value auctions 

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Copyright information

© Kluwer Academic Publishers 1998

Authors and Affiliations

  • Michael B. Gordy
    • 1
  1. 1.Board of Governors of the Federal Reserve SystemWashington, DCU.S.A

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