We study the design of CDS auctions, which determine the payments by CDS sellers to CDS buyers following the defaults of bonds. Through a simple model, we find that the current design of CDS auctions leads to biased prices and inefficient allocations. This is because various restrictions imposed...

We study the design of profit-maximizing mechanisms in environments with interdependent values. A single unit of a good is for sale. There is a known joint distribution of the bidders' ex post values for the good. Two programs are considered:(i) Maximize over mechanisms the minimum over...