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Delegation in first‐price all‐pay auctions
Author(s) -
Konrad Kai A.,
Peters Wolfgang,
Wärneryd Karl
Publication year - 2004
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.1182
Subject(s) - delegate , delegation , bidding , common value auction , microeconomics , incentive , vickrey auction , economics , vickrey–clarke–groves auction , auction theory , business , computer science , management , programming language
In a first‐price all‐pay auction buyers have an incentive to delegate the bidding to agents and to provide these agents with incentives to make bids that differ from the bids the buyers would like to make. Both buyers are better off in this strictly non‐cooperative delegation equilibrium and the delegation contracts are asymmetric, even if the buyers and the auction are perfectly symmetric. Copyright © 2004 John Wiley & Sons, Ltd.