Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/215673
Authors: 
Ehrhart, Karl-Martin
Hanke, Ann-Katrin
Ott, Marion
Year of Publication: 
2020
Series/Report no.: 
ZEW Discussion Papers 20-014
Abstract: 
Auctions with endogenous rationing have been introduced to stimulate competition. Such (procurement) auctions reduce the volume put out to tender when competition is low. This paper finds a strong negative effect of endogenous rationing on participation when bid-preparation is costly, counteracting the aim to stimulate competition. For multiple auctioneer's objectives mentioned in directives, we derive optimal mechanisms, which differ due to different evaluation of the tradeoff between participation and bid-preparation costs. Thus, the auctioneer needs to decide on an objective. However, reducing bid-preparation costs improves the optimal values of multiple objective functions.
Subjects: 
auction
participation
market design
optimal mechanism
renewable energy support
JEL: 
D82
Q48
D47
D44
Document Type: 
Working Paper

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