Articles

No-trade in second-price auctions with entry costs and secret reserve prices

S. LOVO, C. SPAENJERS

Economics Letters

juillet 2017, vol. 156, pp.142-144

Départements : Finance, GREGHEC (CNRS)

Mots clés : Auctions, Entry, Participation costs, Reserve prices, No-trade equilibria

https://www.sciencedirect.com/science/article/pii/S0165176517301702


We consider a second-price private-value auction in the presence of an exogenous participation cost and a secret reserve price endogenously set by the seller. We show that, if the entry cost is strictly positive, the only equilibrium outcome is that the seller chooses a reserve price that deters entry and no buyer enters


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