21 Pages Posted: 11 Oct 2003
Date Written: September 20, 2006
We study asymmetric second-price auctions under incomplete information. The bidders have potentially different, commonly-known, valuations for the object and private information about their entry costs. The seller, however, does not benefit from these entry costs. We calculate the equilibrium strategies of the bidders and analyze the optimal design for the seller in this environment.
Keywords: Symmetric auctions, Asymmetric auctions, Entry costs
JEL Classification: D44, O31, O32
Suggested Citation: Suggested Citation