Testing affiliation in private-values models of first-price auctions using grid distributions

DOI10.1214/10-AOAS344MaRDI QIDQ542974zbMATH OpenOpenAlexFDO

Authors Luciano I. de Castro, Harry J. Paarsch

Publication date 20 June 2011

Published in The Annals of Applied Statistics (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/1101.1398

zbMATH Keywords

affiliationfirst-pricesealed-bid auctionsMTP\(_2\)

Mathematics Subject Classification ID

Applications of statistics to economics (62P20) Hypothesis testing in multivariate analysis (62H15) Auctions, bargaining, bidding and selling, and other market models (91B26)

Abstract: Within the private-values paradigm, we construct a tractable empirical model of equilibrium behavior at first-price auctions when bidders' valuations are potentially dependent, but not necessarily affiliated. We develop a test of affiliation and apply our framework to data from low-price, sealed-bid auctions held by the Department of Transportation in the State of Michigan to procure road-resurfacing services: we do not reject the hypothesis of affiliation in cost signals.

Recommendations

• Semiparametric estimation in models of first-price, sealed-bid auctions with affiliation
• A consistent nonparametric test of affiliation in auction models
• The Affiliation Effect in First-Price Auctions
• Identification of Standard Auction Models
• Nonparametric identification of an interdependent value model with buyer covariates from first-price auction bids

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Cited in

(6)

• Testing affiliation in private-values models of first-price auctions using grid distributions
• A consistent nonparametric test of affiliation in auction models
• Semiparametric estimation in models of first-price, sealed-bid auctions with affiliation
• The econometrics of auctions with asymmetric anonymous bidders
• Inference for first-price auctions with Guerre, Perrigne, and Vuong's estimator
• The Affiliation Effect in First-Price Auctions

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