Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/117893
Authors: 
Fibich, Gadi
Gavious, Arieh
Sela, Aner
Year of Publication: 
2004
Series/Report no.: 
Nota di Lavoro, Fondazione Eni Enrico Mattei 14.2004
Abstract: 
We use perturbation analysis to study independent private-value all-pay auctions with weakly risk-averse buyers. We show that under weak risk aversion: 1) Buyers with low values bid lower and buyers with high values bid higher than they would bid in the risk neutral case. 2) Buyers with low values bid lower and buyers with high values bid higher than they would bid in a first-price auction. 3) Buyers' expected utilities in an all-pay auction are lower than in a first-price auction. 4) The seller's expected payoff in an all-pay auction may be either higher or lower than in the risk neutral case. 5) The seller's expected payoff in an all-pay auction may be either higher or lower than in a first-price auction.
Subjects: 
Private-value auctions
Risk aversion
Perturbation analysis
JEL: 
D44
D72
D82
Document Type: 
Working Paper

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