Consider allocating an object to one of two players when each player's preferences are her private...
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Consider allocating an object to one of two players when each player's preferences are her private information. Player 1's value for the object, denoted by v1 is drawn from a continuous distribution with [1;2] as its support. Player 2's value for the object, denoted by v2, is likewise drawn from the interval [0;1]. 1. What is the equilibrium in dominant strategies if a second price auction is used to allocate the object. Is the outcome ex-post efficient? 2. For what pairs (v1;v2) should Player 1 and Player 2 respectively be allocated the object in a mechanism that maximizes expected revenue for the seller? Consider allocating an object to one of two players when each player's preferences are her private information. Player 1's value for the object, denoted by v1 is drawn from a continuous distribution with [1;2] as its support. Player 2's value for the object, denoted by v2, is likewise drawn from the interval [0;1]. 1. What is the equilibrium in dominant strategies if a second price auction is used to allocate the object. Is the outcome ex-post efficient? 2. For what pairs (v1;v2) should Player 1 and Player 2 respectively be allocated the object in a mechanism that maximizes expected revenue for the seller?
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Related Book For
Microeconomics An Intuitive Approach with Calculus
ISBN: 978-0538453257
1st edition
Authors: Thomas Nechyba
Posted Date:
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