Please use this identifier to cite or link to this item:
|Title:||On the lowest-winning-bid and the highest-losing-bid auctions|
|Publisher:||Dept. of Economics, University of Leicester|
|Abstract:||Theoretical models of multi-unit, uniform-price auctions assume that the price is given by the highest losing bid. In practice, however, the price is usually given by the lowest winning bid. We derive the equilibrium bidding function of the lowest-winning-bid auction when there are k objects for sale and n bidders, and prove that it converges to the bidding function of the highest-losing-bid auction if and only if the number of losers n k gets large. When the number of losers grows large, the bidding functions converge at a linear rate and the prices in the two auctions converge in probability to the expected value of an object to the marginal winner.|
|Series/Report no.:||Papers in Economics|
|Appears in Collections:||Reports, Dept. of Economics|
Items in LRA are protected by copyright, with all rights reserved, unless otherwise indicated.