On the core of auctions with externalities: stability and fairness

• 成果类型: Article
• 署名作者: Jeong, Seungwon (Eugene)
• 署名单位: University of Bristol
• 刊物名称: RAND JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0741-6261
• DOI: 10.1111/1756-2171.12351
• 发表日期: 2020
• 页码: 1093-1107
• 关键词: approximate cores; PROPERTY; ECONOMY

摘要

In auctions with externalities, it is well-known that the core can be empty, which is undesirable both in terms of stability and fairness. Nevertheless, some auction outcome must be chosen. We separate deviations into two types: deviations by paying more and deviations by refusing to pay. In high-stakes auctions where bidders also care about their reputation, the latter are unlikely to occur, or else can be prevented by legal interventions. In contrast, the former is more undesirable in the sense that the seller and the bidders experience justified envy. We show that the core is nonempty if bidders cannot refuse to pay.