Population uncertainty and revealing contestants

A number of contestants randomly arrives according to a Poisson distribution. Under population uncertainty, a contest designer considers whether or not to reveal the number of players to bidders. We show that for the expected revenue, the two policies are equivalent, but for the expected winner’s pa...

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Veröffentlicht in:Economics letters 2021-02, Vol.199, p.109727, Article 109727
Hauptverfasser: Kim, Bara, Yoo, Seung Han
Format: Artikel
Sprache:eng
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Zusammenfassung:A number of contestants randomly arrives according to a Poisson distribution. Under population uncertainty, a contest designer considers whether or not to reveal the number of players to bidders. We show that for the expected revenue, the two policies are equivalent, but for the expected winner’s payment, the revealing policy dominates if the expected number of bidders is sufficiently large, whereas the concealing policy dominates if it is low.
ISSN:0165-1765
1873-7374
DOI:10.1016/j.econlet.2021.109727