SELLER SURPLUS IN FIRST PRICE AUCTIONS

In a first-price sealed-bid discriminatory auction with M winners, the surplus gained by the seller from constant relative and constant abso lute risk-averse bidders is defined. For sufficiently high risk aversi on in these cases, the seller gains all the surplus. It is also shown that constant relative risk-averse bidders are equivalent to risk-neut ral bidders with a transformed distribution of private values.