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Englmaier, Florian
Guillén, Pablo
Llorente, Loreto
Onderstal, Sander
Sausgruber, Rupert
Year of Publication: 
Series/Report no.: 
CESifo Working Paper No. 1782
Multi-unit auctions are sometimes plagued by the so-called exposure problem. In this paper, we analyze a simple game called the chopstick auction' in which bidders are confronted with the exposure problem. We do so both in theory and in a laboratory experiment. In theory, the chopstick auction has an efficient equilibrium and is revenue equivalent with the second-price sealed-bid auction in which the exposure problem is not present. In the experiment, however, we find that the chopstick auction is less efficient than the second-price sealed-bid auction and that it yields more [the same] revenue if bidders are inexperienced [experienced].
Document Type: 
Working Paper

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