First-best collusion without communication

Research output: Contribution to journalArticlepeer-review

Abstract

I study a 2-bidder infinitely repeated IPV first-price auction without transfers, communication, or public randomization, where each bidder's valuation can assume, in each of the (statistically independent) stage games, one of three possible values. Under certain distributional assumptions, the following holds: for every ε > 0 there is a nondegenerate interval δ(ε) ⊂ (0, 1), such that if the bidders' discount factor belongs to δ(ε), then there exists a Perfect Public Equilibrium with payoffs ε-close to the first-best payoffs.

Original languageEnglish
Pages (from-to)224-230
Number of pages7
JournalGames and Economic Behavior
Volume83
DOIs
StatePublished - Jan 2014

Keywords

  • Auctions
  • Collusion
  • Repeated games

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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