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Inverse Adverse Selection: The Market for Gems

Dari-Mattiacci, Giuseppe; Onderstal, Sander; Parisi, … - Tinbergen Instituut - 2011

This paper studies markets plagued with asymmetric information on the quality of traded goods. In Akerlof's setting, sellers are better informed than buyers. In contrast, we examine cases where buyers are better informed than sellers. This creates an inverse adverse selection problem: The market...

Persistent link: https://www.econbiz.de/10011256127

Auctions under Payoff Uncertainty: The Case with Heterogeneous Bidder-Aversion to Downside Risk

Hu, Audrey; Zou, Liang - Tinbergen Instituut - 2008

This paper characterizes the optimal first-price auction (FPA) and second-price auction (SPA) for selling rights …

Persistent link: https://www.econbiz.de/10011256873

Bidding to give in the Field: Door-to-Door Fundraisers had it right from the Start

Onderstal, Sander; Schram, Arthur J.C.; Soetevent, … - Tinbergen Instituut - 2011

. We approached about 4500 households, each participating in either an all-pay auction, a lottery, a non …-pay auction and the lottery. Although the all-pay auction is the superior fundraising mechanism both in theory and in the … anomaly. First, participation in the all-pay auction is substantially lower than in the other mechanisms while the average …

Persistent link: https://www.econbiz.de/10011255620

Sequential Auctions, Price Trends, and Risk Preferences

Hu, Audrey; Zou, Liang - Tinbergen Instituut - 2014

We analyze sequential Dutch and Vickrey auctions where risk averse, or risk preferring, bidders may have heterogeneous risk exposures. We derive and characterize a pure strategy equilibrium of both auctions for arbitrary number of identical objects. A sufficient, and to certain extent necessary,...

Persistent link: https://www.econbiz.de/10011256734

Mergers in Bidding Markets

Janssen, Maarten; Karamychev, Vladimir - Tinbergen Instituut - 2013

We analyze the effects of mergers in first-price sealed-bid auctions on bidders' equilibrium bidding functions and on revenue. We also study the incentives of bidders to merge given the private information they have. We develop two models, depending on how after-merger valuations are created. In...

Persistent link: https://www.econbiz.de/10011256791

Auctions, Market Prices and the Risk Attitude Effect

Janssen, Maarten C.W.; Karamychev, Vladimir A. - Tinbergen Instituut - 2005

firms' risk attitudes and the fact that future market prof-its are uncertain so that winning an auction is like winning a …

Persistent link: https://www.econbiz.de/10011256307

The Consequences of Endogenizing Information for Herd Behavior

Swank, Otto H.; Visser, Bauke - Tinbergen Instituut - 2003

In models of sequential decision making herd behaviour occurs if the signals smart(dumb) agents receive are (un)correlated and if agents have reputational concerns. We show thatintroducing costly effort to become informed about project payoffs (i) eliminates herdbehaviour and (ii) shifts...

Persistent link: https://www.econbiz.de/10011256752

On Committees of Experts

Visser, Bauke; Swank, Otto H. - Tinbergen Instituut - 2005

A committee makes a decision on a project on behalf of "the public." Members of the committee agree on the a priori value of the project, and hold additional private information about its consequences. They are experts who care about the value of the project and about being considered well...

Persistent link: https://www.econbiz.de/10011257003

Politicians' Motivation, Role of Elections, and Policy Choices

Wrasai, Phongthorn - Tinbergen Instituut - 2005

We develop a simple two period model to study the importance of motivational differences among politicians in describing the role of elections and explaining policy choices. In our model, politicians differ in their motives of running public office. Good politicians care about policies while bad...

Persistent link: https://www.econbiz.de/10011257195

Do More Powerful Interest Groups have a Disproportionate Influence on Policy?

Sharif, Zara; Swank, Otto H. - Tinbergen Instituut - 2012

Decisions-makers often rely on information supplied by interested parties. In practice, some parties have easier access to information than other parties. In this light, we examine whether more powerful parties have a disproportionate influence on decisions. We show that more powerful parties...

Persistent link: https://www.econbiz.de/10011257417