Seller Compound Search for Bidders

Lee, Joosung; Li, Daniel Z.

Abstract

This article studies a seller's compound search for bidders by a deadline. We show that the optimal search outcomes can be implemented by a sequence of second‐price auctions, characterized by declining reserve prices and increasing search intensities (sample sizes) over time. The monotonicity results are robust in both cases of short‐lived and long‐lived bidders. Furthermore, a seller with short‐lived bidders sets lower reserve prices and searches more intensively than one with long‐lived bidders. We also show that the inefficiency of an optimal search auction can stem from its inefficient search rule.

Citation

Lee, J., & Li, D. Z. (2023). Seller Compound Search for Bidders. The Journal of Industrial Economics, 71(4), 1004-1037. https://doi.org/10.1111/joie.12355

• Journal Article Type: Article
• Acceptance Date: Sep 23, 2023
• Online Publication Date: Oct 10, 2023
• Publication Date: 2023-12
• Deposit Date: Sep 2, 2022
• Publicly Available Date: Oct 10, 2023
• Journal: The Journal of Industrial Economics
• Print ISSN: 0022-1821
• Electronic ISSN: 1467-6451
• Publisher: Wiley
• Peer Reviewed: Peer Reviewed
• Volume: 71
• Issue: 4
• Pages: 1004-1037
• DOI: https://doi.org/10.1111/joie.12355
• Public URL: https://durham-repository.worktribe.com/output/1196014