Publications
Perfect bidder collusion through bribe and request (with Jingfeng Lu and Christian Riis), Games and Economic Behavior, Vol 129, 2021, 1-14.
Perfect bidder collusion through bribe and request (with Jingfeng Lu and Christian Riis), Games and Economic Behavior, Vol 129, 2021, 1-14.
Working papers
Peace through bribing (with Jingfeng Lu and Christian Riis)
Abstract: We study a model in which before a conflict between two parties escalates into a war (in the form of an all-pay auction), a party can offer a take-it-or-leave-it bribe to the other for a peaceful settlement. In contrast to the received literature, we find that peace security is impossible in our model. We characterize the necessary and sufficient conditions for peace implementability. Furthermore, we find that separating equilibria do not exist and the number of (on-path) bribes in any non-peaceful equilibria is at most two. We also consider a requesting model and characterize the necessary and sufficient conditions for the existence of robust peaceful equilibria, all of which are sustained by the identical (on-path) request. Contrary to the bribing model, peace security is possible in the requesting model.
Optimal Prize Allocations in Contests with Maximal Performance Objective (with Christian Riis)
Abstract: We show that weak concavity of the cost function leads to optimality of single prize in contests with maximal performance objective, which generalizes the previous result in Chawla et al. (2015). Moldovanu and Sela (2001) show that, with the constant elasticity functional form, enough convexity can provide a rationale for multiple prizes under total performance objective. Surprisingly, we find optimality of single prize continues to hold for arbitrary degree of convexity under maximal performance objective when the number of contestants is three. On the contrary, if the cost function is piecewise linear, then the convexity argument for multi-prize can be restored. Furthermore, We find that in terms of optimal prize allocations there is an interesting relationship between the two objectives. In the derivation of the results, a series of simple facts about the winning probability functions is presented, which may be useful for future works in contest theory and multi-object auction theory.
Bayes-Nash equilibria in GSP with Allocative Externalities (with Christian Riis)
Abstract: We investigate an incomplete information model of generalized second price auctions with allocative externalities originating from the heterogeneous match rates of bidders. A novel feature of our model is that it generates endogenous click-through rates (CTRs). In this setting, we establish existence of symmetric efficient equilibria for common classes of primitives. This contrasts with the findings of Gomes and Sweeney (2014), who study a similar model but with fixed CTRs. Moreover, non-existence results require strong assumptions on the primitives of the model. We conclude that existence of equilibria in GSP with incomplete information is quite general.
Peace through bribing (with Jingfeng Lu and Christian Riis)
Abstract: We study a model in which before a conflict between two parties escalates into a war (in the form of an all-pay auction), a party can offer a take-it-or-leave-it bribe to the other for a peaceful settlement. In contrast to the received literature, we find that peace security is impossible in our model. We characterize the necessary and sufficient conditions for peace implementability. Furthermore, we find that separating equilibria do not exist and the number of (on-path) bribes in any non-peaceful equilibria is at most two. We also consider a requesting model and characterize the necessary and sufficient conditions for the existence of robust peaceful equilibria, all of which are sustained by the identical (on-path) request. Contrary to the bribing model, peace security is possible in the requesting model.
Optimal Prize Allocations in Contests with Maximal Performance Objective (with Christian Riis)
Abstract: We show that weak concavity of the cost function leads to optimality of single prize in contests with maximal performance objective, which generalizes the previous result in Chawla et al. (2015). Moldovanu and Sela (2001) show that, with the constant elasticity functional form, enough convexity can provide a rationale for multiple prizes under total performance objective. Surprisingly, we find optimality of single prize continues to hold for arbitrary degree of convexity under maximal performance objective when the number of contestants is three. On the contrary, if the cost function is piecewise linear, then the convexity argument for multi-prize can be restored. Furthermore, We find that in terms of optimal prize allocations there is an interesting relationship between the two objectives. In the derivation of the results, a series of simple facts about the winning probability functions is presented, which may be useful for future works in contest theory and multi-object auction theory.
Bayes-Nash equilibria in GSP with Allocative Externalities (with Christian Riis)
Abstract: We investigate an incomplete information model of generalized second price auctions with allocative externalities originating from the heterogeneous match rates of bidders. A novel feature of our model is that it generates endogenous click-through rates (CTRs). In this setting, we establish existence of symmetric efficient equilibria for common classes of primitives. This contrasts with the findings of Gomes and Sweeney (2014), who study a similar model but with fixed CTRs. Moreover, non-existence results require strong assumptions on the primitives of the model. We conclude that existence of equilibria in GSP with incomplete information is quite general.