EXISTENCE OF OPTIMAL AUCTIONS IN GENERAL ENVIRONMENTS

We provide a unified approach to the problem of existence of optimal a uctions for a wide variety of auction environments. We accomplish this by first establishing a general existence result for a particular Sta ckelberg revelation game. By systematically specializing our revelatio n game to cover various types of auctions, we are able to deduce the e xistence of optimal Bayesian auction mechanisms for single and multipl e unit auctions, as well as for contract auctions with moral hazard an d adverse selection. In all cases, we allow for risk aversion and mult idimensional, stochastically dependent types. (C) 1998 Elsevier Scienc e S.A.