The Effect of Affiliation on Equilibrium Strategies in k-Double Auctions
نویسنده
چکیده
For k-double auctions with k 0 (0,1), the effect of a change in the degree of affiliation between buyer and seller values on equilibrium bidding strategies is described. Local changes are shown to depend on how affiliation influences standard inverse hazard rates. While for some equilibria, increased affiliation results in high-value buyers and low-value sellers shading their bids less, for other equilibria increased affiliation can cause either type of trader to shade their bids more. Globally the impact of increased affiliation on bidding strategies is shown to be non-monotonic for a open set of equilibria.
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