AUCTION-LOTTERY HYBRID MECHANISMS: STRUCTURAL MODEL AND EMPIRICAL ANALYSIS

• 成果类型: Article
• 署名作者: Huang, Yangguang; Wen, Quan
• 署名单位: Hong Kong University of Science & Technology; University of Washington; University of Washington Seattle
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12356
• 发表日期: 2019
• 页码: 355-385
• 关键词: Allocation mechanisms; 1st-price auctions; demand reduction; entry; identification; price

摘要

This article studies an auction-lottery hybrid mechanism that is widely adopted in allocating new vehicle licenses in China. We characterize individuals' entry and bidding strategies in a symmetric Bayesian Nash equilibrium, structurally estimate individuals' value distribution from a data set of a Guangzhou program, and evaluate the performance of the mechanism. Based on the estimated distribution and counterfactual analysis, our study suggests that a hybrid mechanism preserves 83% efficiency and 52% of revenue, while it improves equity by 25 times compared to a pure auction. We show that allowing auction losers to participate in the lottery can further enhance the performance.