We study optimal auctions with expectation-based loss-averse bidders. We first consider when bidders are ex-ante identical. Although symmetric designs are optimal for bidders with expected-utility preferences, if the degree of loss aversion is sufficiently large relative to the variation in...

This paper considers a class of combinatorial auctions with ascending prices, which includes the Vickrey-Clarke-Groves mechanism and core-selecting auctions. In every ascending auction, the Vickrey-target strategy, i.e., bidding up to the Vickrey price based on provisional valuations,...

This paper considers a general package auction problem and a class of payment rules we refer to as standard. In a “standard” pricing rule, each winner pays at least his “minimum required value” to win. The minimum required value coincides with the payment in the Vickrey auction, and...

This paper characterizes the perfect Bayesian equilibrium in an ascending price package auction. Bidders play history-dependent strategies in an ascending auction, and we show that it leads to serious underbidding. We suppose that there are 2 objects and 3 bidders: 2 local and 1 global bidders....

This study compares standard auctions when bidders are financially constrained and valuation is endogenously determined by ex post investment. Bidders have a convex cost function because of financial constraints or borrowing costs. When the valuation is linear in investment, the revenue and...