Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/103898
Authors: 
Fan, Cuihong
Jun, Byoung Heon
Wolfstetter, Elmar G.
Year of Publication: 
2014
Series/Report no.: 
SFB/TR 15 Discussion Paper 467
Abstract: 
The literature on license auctions for process innovations in oligopoly assumed that the auctioneer reveals the winning bid and stressed that this gives firms an incentive to signal strength through their bids, to the benefit of the innovator. In the present paper we examine whether revealing the winning bid is optimal. We consider three disclosure rules: full, partial, and no disclosure of bids, which correspond to standard auctions. We show that more information disclosure increases the total surplus divided between firms and the innovator as well as social surplus. More disclosure also increases bidders' payoff. However, no disclosure maximizes the innovator's expected revenue.
Subjects: 
Auctions
innovation
licensing
information sharing
JEL: 
D21
D43
D44
D45
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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