Can the Seller Benefit from an Insider in Common-Value Auctions?

Campbell, Colin; Levin, Dan

doi:10.1006/jeth.1999.2600

Cited by 46 publications

(39 citation statements)

References 9 publications

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“…Whether or not informational asymmetry and adverse selection were indeed present in slave markets does matter to the extent that not taking it into account may bias evalua- (Campbell and Levin, 2000), multiple units, second-bid (Hernando-Veciana, 2004), or repeated first-price (Hörner and Jamison, 2006) settings. 5 For example, automobile insurers often make efficient use of risk classification to mitigate asymmetric information in their portfolio.…”

Section: Adverse Selection In Slave Marketsmentioning

confidence: 99%

Asymmetric Information and Adverse Selection in Mauritian Slave Auctions

2008

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Information asymmetry is a necessary prerequisite for testing adverse selection. This paper applies this sequence of tests to Mauritian slave auctions. The theory of dynamic auctions with private and common values suggests that when an informed participant is known to be active, uninformed bidders will be more aggressive and the selling price will be higher. We conjecture that observable family links between buyer and seller entailed superior information and find a strong price premium when a related buyer purchased a slave, indicative of information asymmetry. We then test for adverse selection using sale motivation. Our results indicate large discounts on voluntary as compared to involuntary sales. Consistent with adverse selection, the market anticipated that predominantly low-productivity slaves would be brought to the market in voluntary sales. JEL Classification: D 82, N 37

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Section: Adverse Selection In Slave Marketsmentioning

confidence: 99%

Asymmetric Information and Adverse Selection in Mauritian Slave Auctions

2008

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“…He does not criticize the validity of EMW, Theorem 1, though, and provides a correct proof instead. 32 Note that Campbell and Levin (2000) criticize the result that the existence of an inside bidder unambiguously decreases a seller's revenue if compared to the case of symmetric bidder information.…”

Section: Proof Of Lemmamentioning

confidence: 99%

Semi-Public Competitions

Prüfer

2010

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in

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“…also [5]. 3 For expositional simplicity, results are presented for the pure common-value model. Most results can be extended to the general symmetric model of Milgrom and Weber [17] via steps that complicate proofs in ways familiar to students of that paper.…”

Section: The Modelmentioning

confidence: 99%

Private information revelation in common-value auctions

Mares

Harstad

2003

Journal of Economic Theory

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When a seller has information that could help bidders to estimate asset value, a dictum of auction theory has been that all such information should be publicly announced to bidders. The possibility of privately revealing this information to one or more bidders is introduced. Seller in some circumstances may attain higher expected revenue through revealing his information privately. Examples show that the role of private revelation is more complex than simply generating bidder asymmetry. r

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Can the Seller Benefit from an Insider in Common-Value Auctions?

Cited by 46 publications

References 9 publications

Asymmetric Information and Adverse Selection in Mauritian Slave Auctions

Asymmetric Information and Adverse Selection in Mauritian Slave Auctions

Semi-Public Competitions

Private information revelation in common-value auctions

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