北大微观经济学课件(英文版)Ch17 Auctions

2020/6/10,中级微观经济学,ChapterSeventeen,Auctions,2020/6/10,中级微观经济学,WhoUsesAuctions?,Ownersofart,cars,stamps,machines,mineralrightsetc.Q:Whyauction?,2020/6/10,中级微观经济学,WhoUsesAuctions?,Ownersofart,cars,stamps,machines,mineralrightsetc.Q:Whyauction?A:Becausemanymarketsareimperfectanditishardtodiscoverpotentialbuyerstruevaluationsofyourasset.Auctionshelptodiscoverthisinformation.,2020/6/10,中级微观经济学,TypesofAuctions,Englishauction:bidsarepublicannouncementsbidpricerisesuntiltherearenofurtherbidshighestbidwinswinnerpayshisbid.,2020/6/10,中级微观经济学,TypesofAuctions,Sealed-bidfirst-priceauction:bidsareprivateinformationbidsaremadesimultaneouslyhighestbidwinswinnerpayshisbid.,2020/6/10,中级微观经济学,TypesofAuctions,Sealed-bidsecond-priceauction:bidsareprivateinformationbidsaremadesimultaneouslyhighestbidderwinswinnerpayssecond-highestbidalsoknownasaVickreyauction.,2020/6/10,中级微观经济学,TypesofAuctions,Dutchauction:auctioneerannouncesahighbidandthengraduallylowersthebidfirstbuyertoacceptwinsandpaysthatprice.,2020/6/10,中级微观经济学,ReservePrice,Asellerspecifiedbidlevelbelowwhichnosaleismade.,2020/6/10,中级微观经济学,EconomistsClassificationofAuctions,Private-valueauctions:everypotentialbuyerknowsforsureherownvaluationoftheitemforsalealltheseindividualvaluationsareindependentofeachother.,2020/6/10,中级微观经济学,EconomistsClassificationofAuctions,Common-valueauctions:itemforsalehasthesamevaluetoeverypotentialbuyerpotentialbuyersdifferintheirownestimatesofthiscommonvalue.,2020/6/10,中级微观经济学,AuctionDesign,Goals:Paretoefficiencymaximizationofthesellersprofit.,2020/6/10,中级微观经济学,AuctionDesign,Paretoefficiency:theitemmustselltothebuyerwiththehighestvaluationoftheitem.WhichauctionsareParetoefficient?,2020/6/10,中级微观经济学,AuctionsandEfficiency,Englishauctionwithnoreservepricemustbeefficientsince,ifabuyerwithalowvaluationwasabouttobuy,thehighestvaluationbuyerwouldbidhigher.,2020/6/10,中级微观经济学,AuctionsandEfficiency,Englishauctionwithareservepriceneednotbeefficientsinceifthereservepriceissetabovethe(unknowntotheseller)highestbuyervaluation,thentherewillbenosaleandsonogains-to-trade.,2020/6/10,中级微观经济学,AuctionsandEfficiency,Dutchauctionneednotbeefficient.Nobuyerknowsotherbuyersvaluations,sothehighestvaluationbuyermaydelaytoolongandlosetoanotherbidder.,2020/6/10,中级微观经济学,AuctionsandEfficiency,Sealed-bidfirst-priceauctionneednotbeefficient.Nobuyerknowsotherbuyersvaluations,sothehighestvaluationbuyermaybidtoolowandlosetoanotherbidder.,2020/6/10,中级微观经济学,AuctionsandEfficiency,Sealed-bidsecond-priceauctionisParetoefficienteventhoughnobuyerknowstheotherbuyersvaluations(moreonthislater).,2020/6/10,中级微观经济学,WhyUseaReservePrice?,Supposethereare2buyers.Thesellerbelieveseachbuyersvaluationis$20withchance1/2and$50withchance1/2.I.e.withchance1/4each,thesellerbelievesshefacesbuyervaluations($20,$20),($20,$50),($50,$20)and($50,$50).,2020/6/10,中级微观经济学,WhyUseaReservePrice?,I.e.withchance1/4each,thesellerbelievesshefacesbuyervaluations($20,$20),($20,$50),($50,$20)and($50,$50).UseanEnglishauction.Bidsmustberaisedbyatleast$1.Withchance1/4each,winningbidswillbe$20,$21,$21and$50ifthereisnoreserveprice.,2020/6/10,中级微观经济学,WhyUseaReservePrice?,Withchance1/4each,winningbidswillbe$20,$21,$21and$50ifthereisnoreserveprice.Sellersexpectedrevenueis($20+$21+$21+$50)/4=$28withnoreserveprice.,2020/6/10,中级微观经济学,WhyUseaReservePrice?,Withchance1/4each,thesellerbelievesshefacesbuyervaluations($20,$20),($20,$50),($50,$20)and($50,$50).Setareservepriceof$50.Withchance1/4therewillbenosale.Withchance3/4thewinningbidwillbe$50.,2020/6/10,中级微观经济学,WhyUseaReservePrice?,Setareservepriceof$50.Withchance1/4therewillbenosale.Withchance3/4thewinningbidwillbe$50.Sellersexpectedrevenueis,2020/6/10,中级微观经济学,ReservePriceandEfficiency,Thereservepricecausesanefficiencylosssince,withchance1/4,thereisnotrade.,2020/6/10,中级微观经济学,Second-Price,Sealed-BidAuction,bidsareprivateinformationbidsaremadesimultaneouslyhighestbidderwinswinnerpayssecond-highestbidalsoknownasaVickreyauction.,2020/6/10,中级微观经济学,Second-Price,Sealed-BidAuction,Nobidderknowsanyotherbidderstruevaluationoftheitemforsale.Yet,itisindividuallyrationalforeachbiddertostatetruthfullyhisownvaluation.Why?E.g.twobidderswithtruevaluationsv1andv2.,2020/6/10,中级微观经济学,Second-Price,Sealed-BidAuction,E.g.twobidderswithtruevaluationsv1andv2.Bidsareb1andb2.Expectedgaintobidder1is,2020/6/10,中级微观经济学,Second-Price,Sealed-BidAuction,Expectedgaintobidder1isHowisthismaximized?Ifv1b2,thenmaximizetheprob.ofwinning;i.e.setb1=v1.Ifv1b2,thenminimizetheprob.ofwinning;i.e.setb1=v1.Eitherway,tellingthetruthisbest!,2020/6/10,中级微观经济学,Second-Price,Sealed-BidAuction,Sincetruth-tellingisbestforeverybidder,thehighestvaluationbidderwillwin.Hencethesecond-price,sealed-bidauctionisPareto-efficient.,2020/6/10,中级微观经济学,Common-ValueAuctions,Theitemforsalehasthesamevaluetoeverypotentialbuyer.Potentialbuyersdifferintheirownestimatesofthiscommonvalue.Bidderisestimateiswhereisthecommonvalueandisbidderisestimationerror.,2020/6/10,中级微观经济学,Common-ValueAuctions,Bidderisestimateiswhereisthecommonvalueandisbidderisestimationerror.Ifeverybidistruthful,thewinneristhebidderwiththelargestestimationerrorsoatruthfulwinneronaveragepaysmorethanthet