Existence of Equilibria in Auctions with Private Values
Stanford Graduate School of Business Research Paper Series No. 2056
15 Pages Posted: 14 Jul 2010 Last revised: 29 Jul 2010
Date Written: February 1, 2010
A first-price sealed-bid auction of an item for which bidders are risk-neutral and have privately known values is shown to have an equilibrium in mixed behavioral strategies if the joint distribution of bidders' values has a continuous density on a cubical support. Such an equilibrium has atomless distributions of bids and is not affected by the rule for resolving tied bids.
JEL Classification: C72, D44
Suggested Citation: Suggested Citation