Existence of Equilibria in Procurement Auctions

9 Pages Posted: 27 Nov 2017

See all articles by Gyula Seres

Gyula Seres

National University of Singapore (NUS)

Date Written: November 24, 2017

Abstract

This paper investigates symmetric equilibria in first- and second-price auctions with multidimensional types. The constructed model mirrors the information structure of actual procurement auctions. We demonstrate by a counterexample that symmetric and continuous type distribution is not a sufficient condition for the existence of a pure-strategy equilibrium, but it is guaranteed if distributions of all components are log-concave. We state a new Revenue Equivalence Theorem applied to first- and second-price auctions and conclude that the two standard auction formats yields the same expected price to the auctioneer.

Keywords: Auctions, Multidimensional Information, Information Asymmetry, Equilibrium Existence

JEL Classification: C62, D44, D82, H57

Suggested Citation

Seres, Gyula, Existence of Equilibria in Procurement Auctions (November 24, 2017). TILEC Discussion Paper No. 2017-038, Available at SSRN: https://ssrn.com/abstract=3076880 or http://dx.doi.org/10.2139/ssrn.3076880

Gyula Seres (Contact Author)

National University of Singapore (NUS) ( email )

Singapore
Singapore

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