The completion of the Erie Canal traditionally receives primary credit for the rapid growth of trade through the Port of New York relative to other East Coast ports. This credit ignores the dramatic increase in imports through New York prior to the completion of the canal. We examine an...

We consider multi-unit auctions in which there are enough units so that each bidder but one wins every unit that they bid on. We characterize the equilibrium bidding strategy for three different payment rules: the pay-your-bid auction, the uniform price auction in which the price equals the...

Low Revenue equilibria allow participants in an auction to obtain goods at prices lower than would prevail in a competitive market. These outcomes are generated as perfect equilibria of ascending price, multi-unit auctions, without relying on future auctions or signals to sustain collusion. We...

Auctions in which individuals can purchase more than one unit of the good being sold differ in striking ways from multi-unit auctions in which individuals may purchase only one unit. The uniform price auction in particular frequently yields Nash equilibria in which bidders underbid for their...

We consider an auction in which the behavior of one potential bidder departs mildly from full rationality. We show that the presence of such an inexpert bidder can be enough to discourage all of an infinitely large population of fully rational potential bidders from entering an auction....

This paper presents an equilibrium explanation for the persistence of naive bidding. Specifically, we consider a common value auction in which a "naive" bidder (who ignores the Winner's Curse) competes against a fully rational bidder (who understands that her rival is not). We show that the...

We present results of several experiments that deal with endogenous entry in auctions and auction valuation. One observation that is constant across all of the experiments we report is that laboratory subjects have a difficult time evaluating potential gains from auctions. Even after they are...