Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259803 
Year of Publication: 
2022
Series/Report no.: 
ZEW Discussion Papers No. 22-016
Publisher: 
ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung, Mannheim
Abstract: 
We study the optimal entry fee in a symmetric private value first-price auction with signaling, in which the participation decisions and the auction outcome are used by an outside observer to infer the bidders' types. We show that this auction has a unique fully separating equilibrium bidding function. When the bidders' sensibility for the signaling concern is sufficiently strong, the expected revenue maximizing entry fee is the maximal fee that guarantees full participation. The larger is the bidder's sensibility, the higher is the optimal participation.
Subjects: 
first-price auction
entry
monotonic signaling
social status
JEL: 
D44
D82
Document Type: 
Working Paper

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