Uniqueness of the reserve price with asymmetric bidders

Hikmet Günay, Xin Meng, Mark Nagelberg

Abstract


We analyze the optimal reserve price in a second price auction when there are types of bidders whose valuations are drawn from different distribution functions. The seller cannot determine the specific “distribution type” of each bidder. In this paper, we give sufficient conditions for the uniqueness of the optimal reserve price. Then, we give sufficient conditions that ensure the seller will not use a reserve price; hence, the auction will be efficient.


Keywords


Auction, Reserve (Reservation) Price, Asymmetric Bidders

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