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Auction first-price

Setting an auction reserve price would only have no impact in two unlikely situations. First, with very weak emission targets (or extremely cheap abatement) the allowance price might drop to... [Pg.151]

First price auction. This is the common form of sealed or written bid auction, in which the highest bidder is awarded the item at a price equal to the amount bid. This procedure is thus called a sealed-bid first price auction. It is commonly used to sell off multiple units, such as short-term U.S. Treasury securities. [Pg.274]

First-in-first-out (FIFO), 1521, 2157, 2167 First Man program, 1112 First price auctions, 274 First-principle models of human behavior, 2413-2414. See also Man-Machine Integrated Design and Analysis System (MIDAS)... [Pg.2731]

Optimal Multiattribute Auctions. Che [25] has proposed optimal multiattribute auctions for the special case of seller cost functions that are defined in terms of a single unknown parameter. Che s auctions are direct-revelation mechanisms, and he considers both first-price and second-price variations. The second-price variation is exactly the one-sided VCG mechanism, and Che is able to derive the optimal scoring function (or reported cost function) that the buyer should state to maximize her payoff in equilibrium. Branco [21] extends the analysis to consider the case of correlated seller cost functions. No optimal multiattribute auction is known for a more general formulation of the problem, for example for the case of preferential-independence. [Pg.193]

A mechanism must be able to make a commitment to use these rules. Without this commitment ability the equilibrium of a mechanism can quickly unravel. For example, if an auctioneer in a second-price auction cannot commit to selling the item at the second-price than the auction looks more like a first-price auction [83]. [Pg.204]

As a special case, we get the celebrated revenue-equivalence theorem [100, 65], which states that the most popular auction formats, i.e. English, Dutch, first-price sealed-bid and second-price sealed-bid, all yield the same price on average in a single item allocation problem with symmetric agents. This is an immediate consequence because these auctions are all efficient in the simple private values model. [Pg.204]

Suppose one runs a sealed bid, first price auction in which bidders are asked to submit their values. The problem for each bidder is that her value is unknown at the start of the auction. It depends on the private signal of the rival bidder. A bidder could use her knowledge of the distribution from which the signals are drawn to estimate this value and bid the estimate or something below it. This is not guaranteed to produce the efficient outcome. Furthermore, it can, if bidders are bidding conservatively, depress revenues to the auctioneer. [Pg.279]

In the combined strategy the buyer forms an alliance with the first-period supplier such that the unit price in the second period is guaranteed to be p(l — A). To get this price guarantee, the buyer commits to purchasing a minimum quantity Q2- If additional units are required, the buyer can freely decide whether to buy from this supplier or to get the needed units in an auction at price p2- Let n denote the number of units purchased in the second period... [Pg.649]

Some other analysts express the opposite concern, that prices might rise to levels deemed to pose an unacceptable risk to European industry, and that to prevent this risk the system should contain a price cap or safety valve (e.g. Bouttes et al., 2006). Our assessment of phase II, in terms of both supply-demand balance and the economics of competitiveness over the 5-year period, leads us to be sceptical that this is a realistic concern. It is, however, true that a planned response to any such eventuality would be better than a panic-based reaction such as occurred in the California NOx trading system. Should prices rise to levels that were judged to pose a credible threat to competitiveness of a particular sector, and State-aid rules prevented auction revenues being used to assist it (or the country concerned had not conducted any auctions), the most obvious first step would be to relax supplementarity constraints, and possibly expand the scope of emission credits that could qualify for compliance purposes. We do not consider issues of price ceilings or safety valves beyond this. [Pg.23]

Auctions offer some additional approaches to providing a basis for a clear, long-term carbon price signal. First, the mechanisms discussed above could be used to create a long-term price floor . This could be implemented by auctioning all allowances with a reserve price equal to the price floor, coupled with a government commitment to repurchase allowances at the price floor. If credible, a price floor would increase investor confidence in the profitability of low-carbon technology investments. [Pg.153]

Emission reductions relative to the reference case will be approximately 5 MtCO in 2012 and 15 MtCO in 2018d Prices have been projected to rise gradually from US 2 in 2009 to US 3.75 in 2018. The clearing price for the first three quarterly auctions increased from US 3.07 per allowance in September 2008 to US 3.51 in March 2009. [Pg.42]

The first linker to be issued was a 20-year bond with a zero-coupon structure (No. 3001, 0% 2014). A selection of the eight Primary Dealers in the nominal market took responsibility to quote two-way prices for the new bond. The Debt Office held five common price auctions from April to June, which saw a face value of SEK16 billion being offered to the market. But demand for much higher real yields from the market meant that only SEK6.7 billion was allotted. [Pg.246]

Auctions are single-price, rather than the multiple-price auctions used for nominal gilts, and have been smaller in size than for nominals. The approach has been to repeatedly reopen existing linker issues at each auction—the recent 2% 2035 issue was the first new bond in 10 years. [Pg.257]

But what if there were two suppliers, each competing to win the contract. Suppose the two suppliers have produaion costs of r, and s, with a> 2> s. Consider a system in which the suppliers first compete on wholesale price, and the buyer chooses the appropriate retail price and quantity. F the two suppliers participated in an auction, then the wholesale price charged to the buyer would be Si- This wholesale price is always smaller than the best that can... [Pg.69]

We first consider a wholesale price auction. In a wholesale price auction, the buyer announces his purchase quantity, choosing his retail price before he knows supplier bids. The buyer has to use his expectation of supplier costs while making the quantity decision. Each supplier has to post wholesale prices in response, and the buyer merely picks his best option. Though suppliers do not know each other s bids because an auction is used, the resulting wholesale price is max(r,r2). For the suppliers to be competitive, their cost s has to be lower than the wholesale prices that each of them would offer the buyer if they were by themselves, i.e., each... [Pg.70]

However, under a catalog auction, the retailer gets to adjust the purchase quantity in response to the wholesale prices obtained. Thus, the suppliers first compete on wholesale price, and the winning price is 2-... [Pg.70]

Step b) can be answered by paying careful attention to an economic interpretation of the complementary-slackness (CS) conditions. The goal is to demonstrate that the auction terminates with an allocation and prices that satisfy the CS conditions. We provide an outline of the proof of the properties of /Bundle, focusing on the special case (/Bundle(2)) that prices are still anonymous. See Parkes Ungar [79] for additional details. Let Xi S) = 1 denote that bundle S is allocated to agent /, and let tti denote the maximal payoff to agent i at prices p S). The first important CS condition is ... [Pg.188]

We ignore these issues and focus separately on revenue maximization and efficiency. We first identify what the theory has to say about the design of auctions to achieve each of these objectives. It will be seen that these auctions are impractical to implement as is and adjustments must be made. These adjustments come at a price and we will identify the tradeoffs that must be made. [Pg.249]

Ascending auctions come in two varieties (with hybrids possible). In the first, bidders submit, in each round, prices on various bundles. The auctioneer makes a provisional allocation of the items that depends on the submitted prices. Bidders are allowed to adjust their price offers from the previous rounds and the auction continues. Such auctions come equipped with rules to ensure rapid progress and encourage competition. Ascending auctions of this type seem to be most prevalent in practice. [Pg.265]


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See also in sourсe #XX -- [ Pg.193 , Pg.204 ]




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