EconStor >
Universität Bielefeld >
Institute of Mathematical Economics (IMW), Universität Bielefeld >
Working Papers, Institute of Mathematical Economics, Universität Bielefeld >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/43771
  
Title:Evolutionary stability of first price auctions PDF Logo
Authors:Louge, Fernando
Riedel, Frank
Issue Date:2010
Series/Report no.:Working papers // Institute of Mathematical Economics 435
Abstract:This paper studies the evolutionary stability of the unique Nash equilibrium of a first price sealed bid auction. It is shown that the Nash equilibrium is not asymptotically stable under payoff monotonic dynamics for arbitrary initial popu- lations. In contrast, when the initial population includes a continuum of strategies around the equilibrium, the replicator dynamic does converge to the Nash equilibrium. Simulations are presented for the replicator and Brown-von Neumann-Nash dynamics. They suggest that the convergence for the replicator dynamic is slow compared to the Brown-von Neumann-Nash dynamics.
Subjects:Auction theory
Evolutionary stability
JEL:C73
D44
Persistent Identifier of the first edition:urn:nbn:de:hbz:361-17291
Document Type:Working Paper
Appears in Collections:Working Papers, Institute of Mathematical Economics, Universität Bielefeld

Files in This Item:
File Description SizeFormat
640696813.pdf1.39 MBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/43771

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.