Demand Reduction and Inefficiency in Multi-Unit Auctions

Inefficiency of Standard Multi-unit Auctions

We study two standard multi-unit auction formats for allocating multiple units of a single good to multi-demand bidders. The first one is the Discriminatory Auction, which charges every winner his winning bids. The second is the Uniform Price Auction, which determines a uniform price to be paid per unit. Variants of both formats find applications ranging from the allocation of state bonds to in...

On the Inefficiency of Standard Multi-Unit Auctions

We study two standard multi-unit auction formats for allocating multiple units of asingle good to multi-demand bidders. The first one is the Discriminatory Auction, whichcharges every winner his winning bids. The second is the Uniform Price Auction, whichdetermines a uniform price to be paid per unit. Variants of both formats find applicationsranging from the allocation of s...

Buy-Out Prices in Online Auctions: Multi-Unit Demand*

On many online auction sites it is now possible for a seller to augment his auction with a maximum or buy-out price. The use of this instrument has been justified in “one-shot” auctions by appeal to impatience or risk aversion. Here we offer additional justification by observing that trading on internet auctions is not of a “one-shot” nature, but that market participants expect more transaction...

Demand Reduction in Multi-Unit Auctions: Evidence from a Sportscard Field Experiment: Reply (March 2005)

We welcome Dan Levin’s comment as a nice example of the manner in which we believe science should ideally proceed. The story begins with a real-world observation: the existence of multi-unit uniform-price auctions. It continues with a theory: Richard EngelbrechtWiggans and Charles M. Kahn’s (1998) theory of demand reduction in uniform-price auctions. Next comes an experiment: John List and Davi...

Sequential Auctions with Multi-Unit Demand: Theory, Experiments and Simulations