Identification in Auction Models with Interdependent Costs

• 成果类型: Article
• 署名作者: Somaini, Paulo
• 署名单位: Stanford University; National Bureau of Economic Research
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/709970
• 发表日期: 2020
• 页码: 3820-3871
• 关键词: 1st-price auctions; quantile regression; nonparametric identification; reserve prices; winners curse; equilibrium; common; INFORMATION; EXISTENCE; inference

摘要

This paper provides a nonparametric identification result for procurement models with asymmetric bidders, dependent private information, and interdependent costs. For risk-neutral bidders, the model's payoff-relevant primitives are the joint distribution of private information and each bidder's full-information expected cost. The joint distribution of bids identifies the joint distribution of signals. First-order conditions identify the expected cost conditional on tying with at least one competitor for the lowest bid. I show identification of each bidder's full-information cost, using variation in competitors' cost shifters that are excludable from bidders' own full-information costs, and generate variation in the set of competitors' signals that induce a tie for the lowest bid. I estimate the relevant payoff primitives using data from Michigan highway procurements and evaluate policies that affect the winner's curse's severity.