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Title:Divisible-good uniform price auctions: The role of allocation rules and communication among bidders PDF Logo
Authors:Sefton, Martin
Zhang, Ping
Issue Date:2009
Series/Report no.:CeDEx discussion paper series 2009-21
Abstract:We use laboratory experiments to compare allocation rules in uniform price divisible good auctions. 'Standard' and 'uniform' allocation rules admit different types of low-price equilibria, which are eliminated by a 'hybrid' rule. We observe little evidence of revenue differences among the allocation rules. Under all three allocation rules, prices are competitive when bidders cannot explicitly communicate, and collusive when bidders can explicitly communicate. With explicit communication we find that collusive agreements are more fragile when the gain from a unilateral deviation is larger. We also find that the standard allocation rule is particularly vulnerable to collusive equilibria.
uniform price auction
multi-unit auction
divisible-good auction
allocation rule
Document Type:Working Paper
Appears in Collections:CeDEx Discussion Paper Series, The University of Nottingham

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