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Incumbency and entry in license auctions: The Anglo-Dutch auction meets other simple alternatives

Azacis, Helmuts ORCID: and Burguet, Roberto 2005. Incumbency and entry in license auctions: The Anglo-Dutch auction meets other simple alternatives. [Working Paper]. Cardiff Economics Working Papers, Cardiff: Cardiff University. Available at:

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The existence of ex-ante strong incumbents may constitute a barrier to entry in auctions for goods such as licenses. Introducing inef-ficiencies that favor entrants is a way to induce entry and thus create competition. Designs such as the Anglo-Dutch auction have been proposed with this goal in mind. We Örst show that indeed the AngloDutch auction fosters entry and increases the revenues of the seller. However, we argue that a more e§ective way could be to stage the allocation of the good so that each stage reveals information about the participants. We show that a sequence of English auctions, with high reserve prices in early rounds, is a procedure with this property that is more e¢ cient than any one-stage entry auction. Moreover, it also dominates the Anglo-Dutch auction in terms of sellerís revenues.

Item Type: Monograph (Working Paper)
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HF Commerce
Publisher: Cardiff University
Date of First Compliant Deposit: 30 March 2016
Last Modified: 24 Oct 2022 10:19

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