Symmetric Separating Equilibria in English Auctions

SSRI Working Paper No. 2017R

9 Pages Posted: 6 Dec 2000

See all articles by Philip A. Haile

Philip A. Haile

Yale University - Department of Economics; National Bureau of Economic Research (NBER); Yale University - Cowles Foundation

Sushil Bikhchandani

University of California, Los Angeles - Anderson School of Management

John G. Riley

affiliation not provided to SSRN

Date Written: October 9, 2000

Abstract

We characterize the set of perfect Bayesian equilibria in symmetric separating strategies in Milgrom and Weber's (1982) model of English auctions. There is a continuum of such equilibria. The equilibrium derived by Milgrom and Weber is that in which bids are maximal. Only in the case of pure private values does a restriction to weakly undominated strategies select a unique equilibrium. This has important implications for empirical studies of English auctions, particularly outside the pure private values paradigm.

JEL Classification: D44, D82

Suggested Citation

Haile, Philip A. and Bikhchandani, Sushil and Riley, John G., Symmetric Separating Equilibria in English Auctions (October 9, 2000). SSRI Working Paper No. 2017R, Available at SSRN: https://ssrn.com/abstract=247794 or http://dx.doi.org/10.2139/ssrn.247794

Philip A. Haile (Contact Author)

Yale University - Department of Economics ( email )

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Yale University - Cowles Foundation

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Sushil Bikhchandani

University of California, Los Angeles - Anderson School of Management ( email )

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John G. Riley

affiliation not provided to SSRN