Imperial College London
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ProfessorEdwardAnderson

Business School

Professor of Analytics and Operations Management
 
 
 
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Contact

 

e.anderson

 
 
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Location

 

392Business School BuildingSouth Kensington Campus

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Summary

 

Publications

Citation

BibTex format

@article{Anderson:2018:10.1016/j.jet.2018.01.008,
author = {Anderson, E and Holmberg, P},
doi = {10.1016/j.jet.2018.01.008},
journal = {Journal of Economic Theory},
pages = {318--341},
title = {Price instability in multi-unit auctions},
url = {http://dx.doi.org/10.1016/j.jet.2018.01.008},
volume = {175},
year = {2018}
}
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RIS format (EndNote, RefMan)

TY  - JOUR
AB  - We consider a uniform-price procurement auction with indivisible units and private independent costs. We find an explicit solution for a Bayesian Nash equilibrium, which is unique if demand shocks are sufficiently evenly distributed. The equilibrium has a price instability in the sense that a minor change in a supplier's realized cost can result in a drastic change in the market price. We quantify the resulting volatility and show that it is reduced as the size of indivisible units decreases. In the limit, the equilibrium converges to the Supply Function Equilibrium (SFE) for divisible goods if costs are common knowledge.
AU  - Anderson,E
AU  - Holmberg,P
DO  - 10.1016/j.jet.2018.01.008
EP  - 341
PY  - 2018///
SN  - 0022-0531
SP  - 318
TI  - Price instability in multi-unit auctions
T2  - Journal of Economic Theory
UR  - http://dx.doi.org/10.1016/j.jet.2018.01.008
UR  - http://gateway.webofknowledge.com/gateway/Gateway.cgi?GWVersion=2&SrcApp=PARTNER_APP&SrcAuth=LinksAMR&KeyUT=WOS:000432416900012&DestLinkType=FullRecord&DestApp=ALL_WOS&UsrCustomerID=1ba7043ffcc86c417c072aa74d649202
UR  - http://hdl.handle.net/10044/1/79151
VL  - 175
ER  -
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