Perfect bidder collusion through bribe and request

• 成果类型: Article
• 署名作者: Lu, Jingfeng; Lu, Zongwei; Riis, Christian
• 署名单位: National University of Singapore; Shandong University; BI Norwegian Business School
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2021.05.001
• 发表日期: 2021
• 页码: 1-14
• 关键词: Second-price auction; collusion; Multidimensional signaling; bribe

摘要

We study collusion in a second-price auction with two bidders in a dynamic environment. One bidder can make a take-it-or-leave-it collusion proposal, which consists of both an offer and a request of bribes, to the opponent. We show that there always exists a robust equilibrium in which the collusion success probability is one. In the equilibrium, for each type of initiator the expected payoff is generally higher than the counterpart in any robust equilibria of the single-option model (Eso and Schummer (2004)) and any other separating equilibria in our model. (C) 2021 The Author(s). Published by Elsevier Inc.