Auctions of heterogeneous objects

Simultaneous seared bid auctions of heterogeneous objects are analyzed. Eac h bidder's reservation value for an object depends upon the other objects h e obtains. Bidders' reservation values are common knowledge. in simultaneou s first-price auctions, the set of Walrasian equilibrium allocations contai ns the set of pure strategy Nash equilibrium allocations which in turn cont ains the set of strict Walrasian equilibrium allocations. Hence, pure strat egy Nash equilibria (when they exist) are efficient. Mixed strategy Nash eq uilibria may be inefficient. In simultaneous second-price auctions, any eff icient allocation can be implemented as a pure strategy Nash equilibrium ou tcome if a Walrasian equilibrium exists. Classification Numbers: D44, D51. (C) 1999 Academic Press.