Access

You are not currently logged in.

Access your personal account or get JSTOR access through your library or other institution:

login

Log in to your personal account or through your institution.

If you need an accessible version of this item please contact JSTOR User Support

A Convergence Theorem for Competitive Bidding with Differential Information

Paul R. Milgrom
Econometrica
Vol. 47, No. 3 (May, 1979), pp. 679-688
Published by: The Econometric Society
DOI: 10.2307/1910414
Stable URL: http://www.jstor.org/stable/1910414
Page Count: 10
  • Read Online (Free)
  • Download ($10.00)
  • Subscribe ($19.50)
  • Cite this Item
If you need an accessible version of this item please contact JSTOR User Support
A Convergence Theorem for Competitive Bidding with Differential Information
Preview not available

Abstract

This paper investigates the behavior of the winning bid in a sealed bid tender auction where each bidder has private information. With an appropriate concept of value, the winning bid will converge in probability to the value of the object auction (as the number of bidders grow large) if and only if a certain information condition is satisfied. In particular, it is not necessary for any bidder to know the value at the time the bids are submitted. These results bear on the relationship between price and value and on the aggregation of private information by the auction mechanism.

Page Thumbnails

  • Thumbnail: Page 
679
    679
  • Thumbnail: Page 
680
    680
  • Thumbnail: Page 
681
    681
  • Thumbnail: Page 
682
    682
  • Thumbnail: Page 
683
    683
  • Thumbnail: Page 
684
    684
  • Thumbnail: Page 
685
    685
  • Thumbnail: Page 
686
    686
  • Thumbnail: Page 
687
    687
  • Thumbnail: Page 
688
    688