EXPECTED REVENUE OF ALL-PAY AUCTIONS AND FIRST-PRICE SEALED-BID AUCTIONS WITH BUDGET CONSTRAINTS

Authors
CHE YK GALE I
Citation
Yk. Che et I. Gale, EXPECTED REVENUE OF ALL-PAY AUCTIONS AND FIRST-PRICE SEALED-BID AUCTIONS WITH BUDGET CONSTRAINTS, Economics letters, 50(3), 1996, pp. 373-379
Citations number
13
Categorie Soggetti
Economics
Journal title
Economics letters → ACNP
ISSN journal
01651765
Volume
50
Issue
3
Year of publication
1996
Pages
373 - 379
Database
ISI
SICI code
0165-1765(1996)50:3<373:EROAAA>2.0.ZU;2-F
Abstract
We show that all-pay auctions dominate first-price sealed-bid auctions when bidders face budget constraints. This ranking is explained by th e fact that budget constraints bind less frequently in the all-pay auc tions, which leads to more aggressive bidding in that format.