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Published March 2004 | public
Journal Article

The simultaneous, ascending auction: dynamics of price adjustment in experiments and in the UK3G spectrum auction

Abstract

We develop a model of the behavior of bidders in simultaneous ascending auctions based on two principles: principle of surplus maximization and principle of bid minimization. These principles lead to models of both price dynamics and equilibration, leading to disequlibrium structural equations that can be used for estimating bidder values. The intention behind the development of this methodology is to provide an auctioneer a method of extracting information during an auction about possible closing prices. We benchmark the performance of the model with data from experimental auctions and then apply it to the UK UMTS or Third Generation Mobile Auction.

Additional Information

© 2003 Elsevier B.V. Received 22 July 2002; accepted 26 January 2003. The authors would like to thank participants at the 2001 ESA meetings in Barcelona and the 2001 INFORMS annual meeting as well as seminar attendees at Humboldt University in Berlin and Clemson University for many useful comments. We would also like to thank the National Science Foundation, Caltech's Lee Center for Advanced Networking and Caltech's Laboratory for Experimental Economics and Political Science for financial and technical support.

Additional details

Created:
August 19, 2023
Modified:
March 5, 2024