The choice of eliminating the uncertainty cloud in auctions

Esther David, David Sarne

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

1 Scopus citations

Abstract

This paper investigates auction settings where bidders private values depend on a common value element which encapsulates some inherent uncertainty concerning its value. In particular, we are interested in scenarios where the auctioneer may have access to accurate information that eliminates the uncertainty concerning the common value. The auctioneer in this case should reason about whether or not to disclose that information, or part of it, to the bidders. In particular, we distinguish between the case where the bidders are aware of the existence of such information on the auctioneer's side and when they are unaware of its existence. We show that the auctioneer's decision of whether to disclose information to the bidders is environment-dependent and affected by various factors, such as the number of bidders, the bidders' valuation functions and the a-priori level of uncertainty associated with the common value. Furthermore, we show that the awareness of the bidders to the option to obtain more accurate information plays a significant role in the decision of whether or not to disclose such information.

Original languageEnglish
Title of host publicationAgent-Mediated Electronic Commerce
Subtitle of host publicationDesigning Trading Strategies and Mechanisms for Electronic Markets - IJCAI Workshop, TADA 2009, Selected and Revised Papers
PublisherSpringer Verlag
Pages15-28
Number of pages14
ISBN (Print)9783642151163
DOIs
StatePublished - 2010
Event2009 Workshop on Trading Agent Design and Analysis, TADA 2009, Co-located with the IJCAI 2009 Conference - Pasadena, CA, United States
Duration: 13 Jul 200913 Jul 2009

Publication series

NameLecture Notes in Business Information Processing
Volume59 LNBIP
ISSN (Print)1865-1348

Conference

Conference2009 Workshop on Trading Agent Design and Analysis, TADA 2009, Co-located with the IJCAI 2009 Conference
Country/TerritoryUnited States
CityPasadena, CA
Period13/07/0913/07/09

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