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The value of information for auctioneers


Hagedorn, M (2009). The value of information for auctioneers. Journal of Economic Theory, 144(5):2197-2208.

Abstract

An auctioneer wants to sell an indivisible object to one of multiple bidders, who have private information about their valuations of the object. A bidder's information structure determines the accuracy with which the bidder knows her private valuation. The main result of the paper is that the auctioneer's revenue is a convex function of bidders' information structures. One implication is that assigning asymmetric information structures instead of symmetric information structures to bidders is always revenue-enhancing. This paper generalizes a result of Bergemann and Pesendorfer [3], who show that revenue-maximizing information structures are asymmetric.

Abstract

An auctioneer wants to sell an indivisible object to one of multiple bidders, who have private information about their valuations of the object. A bidder's information structure determines the accuracy with which the bidder knows her private valuation. The main result of the paper is that the auctioneer's revenue is a convex function of bidders' information structures. One implication is that assigning asymmetric information structures instead of symmetric information structures to bidders is always revenue-enhancing. This paper generalizes a result of Bergemann and Pesendorfer [3], who show that revenue-maximizing information structures are asymmetric.

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Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Economics
Dewey Decimal Classification:330 Economics
Language:English
Date:September 2009
Deposited On:19 Jan 2010 09:03
Last Modified:06 Dec 2017 23:26
Publisher:Elsevier
ISSN:0022-0531
Publisher DOI:https://doi.org/10.1016/j.jet.2009.04.002

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