in a perfect Bayesian equilibrium. If the agent's type is his private information, Pareto frontier of mechanisms' payoffs … optimal price is the optimal mechanism. The complete information case is a strong form of folk theorem while the incomplete … information case shows that folk theorem breaks down with private information even as the discount factor goes to one. Results …

. Yet, to our knowledge, the literature lacks a formal equilibrium analysis of this auction. We provide such an analysis for … the two-player case with complete and incomplete information, and in so doing identify what we call the “Herodotus Paradox.” …