Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/38961
Authors: 
Biran, Omer
Forges, Françoise
Year of Publication: 
2010
Series/Report no.: 
CESifo working paper Industrial Organisation 3067
Abstract: 
We propose a semi-cooperative game theoretic approach to check whether a given coalition is stable in a Bayesian game with independent private values. The ex ante expected utilities of coalitions, at an incentive compatible (noncooperative) coalitional equilibrium, describe a (cooperative) partition form game. A coalition is core-stable if the core of a suitable characteristic function, derived from the partition form game, is not empty. As an application, we study collusion in auctions in which the bidders' final utility possibly depends on the winner's identity. We show that such direct externalities offer a possible explanation for cartels' structures (not) observed in practice.
Subjects: 
auctions
Bayesian game
collusion
core
partition function game
JEL: 
C71
C72
D44
Document Type: 
Working Paper

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