Optimality and robustness of the English auction (Q5954065)
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scientific article; zbMATH DE number 1698485
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| English | Optimality and robustness of the English auction |
scientific article; zbMATH DE number 1698485 |
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Optimality and robustness of the English auction (English)
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30 January 2003
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In \textit{P. R. Milgrom} and \textit{R. J. Weber}'s [``A theory of auctions and competitive bidding'' Econometrica 50, 1089-1122 (1982; Zbl 0487.90017)] ``general symmetric model'', under a few additional regularity conditions, the English auction maximizes the seller's expected profit within the class of all posterior-implementable trading procedures and fails to do so among all interim incentive-compatible procedure in which ``losers do not pay''. The author ascertains that these results suggest that appropriate notions of robustness and simplicity which imply the optimality of the English auction for a risk-neutral seller must impose ``bargaining-like'' features on the set of feasible trading mechanisms.
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market models
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English auction
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risk-neutral seller
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0.8851662874221802
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0.8503024578094482
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0.8470870852470398
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0.8469679355621338
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0.8138271570205688
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