A note on buyers' behavior in auctions with an outside option (Q2221276)

The article discusses an interesting upgrade of research related to competition in online markets with auctions and posted prices by \textit{A. Maslov} [Competition in online markets with auctions and posted prices. KSU Coles College of Business Working Paper Series. (2019), \url{https://coles.kennesaw.edu/research/docs/fall-2019/FALL19-02.pdf}]. More precisely, the author show that the equilibrium in cutoff strategies observed in auctions with a buy-it-now price may also arise in markets where objects are sold simultaneously by auctions and posted prices. However, contrary to auctions with a buy-it-now price where buyers need to know only the total number of players in the market, in the latter environment buyers must also observe the number of active bidders in the auction for the equilibrium to exist in cutoff strategies. One of the requirements for a buyer to follow a cutoff strategy is to observe the second-highest order statistic among his opponents. However, in reality, obtaining information specifically on the second order statistic is hardly alienable from the information on the bids of all other buyers. Hence, the condition is generalized to the observance of all active bidders.