On the Performance of the Crémer–McLean Auction : An Experiment

Nishimura, Takeshi; Hanaki, Nobuyuki

On the Performance of the Crémer–McLean Auction : An Experiment

Nishimura, Takeshi; Hanaki, Nobuyuki

Institute of Social and Economic Research Discussion Papers, 2024, 1266, 1-45

アクセス数:215件（2025-09-03 22:49 集計）

固定URL: https://hdl.handle.net/11094/98513

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タイトル	On the Performance of the Crémer–McLean Auction : An Experiment
著者	NRID 1000080452308 1000080452308 ORCID 0000-0003-3800-2194 0000-0003-3800-2194 researchmap permalink takeshinishim takeshinishim 著者名 Nishimura, Takeshi
著者	NRID 1000070400611 1000070400611 ORCID 0000-0003-3127-690X 0000-0003-3127-690X researchmap permalink nhanaki nhanaki Scopus Author ID 16233221700 16233221700 著者名 Hanaki, Nobuyuki
キーワード等	Full surplus extraction
	Crémer–McLean auction
	auction experiment
	evolutionary stability
	perturbed replicator dynamics
抄録	The paradoxical full-surplus-extraction (FE) result, which can impair the mechanism design paradigm, is a long-standing concern in the literature. We tackle this problem by experimentally testing the performance of an FE auction, which is a second-price (2P) auction with lotteries. In the FE treatment, overbid amounts given entry increased and entry rates decreased through rounds, thus FE failed. By contrast, most subjects learned value bidding in the 2P treatment. To identify the causes of failure in the FE, we take an evolutionary-game approach. The FE auction with risk-neutral bidders has exactly two symmetric equilibria, either value bidding with full or partial entry, and only the partial-entry equilibrium is (evolutionarily or asymptotically) stable. Replicator dynamics with vanishing trends well explain observed dynamic bidding patterns. Together, these findings suggest that the FE outcome is not robust to trial-and-error learning by bidders.
出版者	The Institute of Social and Economic Research, Osaka University
収録物名	Institute of Social and Economic Research Discussion Papers
巻(号)	1266
ページ	1-45
刊行年月	2024-11
言語	英語
ハンドルURL	https://hdl.handle.net/11094/98513
PISSN	0473453X
eISSN	24350982
関連情報 (references)	URI https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2024/DP1266.pdf
アクセス権	metadata only access
カテゴリ	ディスカッション／ワーキング・ペーパー DP/WP
カテゴリ	Institute of Social and Economic Research Discussion Papers

資源タイプ	テクニカルレポート
ローカル資源タイプ	ディスカッション／ワーキング・ペーパー
DCMI資源タイプ	text
DCTERMS.bibliographicCitation	Institute of Social and Economic Research Discussion Papers. 2024, 1266, p. 1-45
DC.title	On the Performance of the Crémer–McLean Auction : An Experiment
DC.creator	Nishimura, Takeshi
DC.creator	Hanaki, Nobuyuki
DC.publisher	The Institute of Social and Economic Research, Osaka University
DC.language' scheme='DCTERMS.RFC1766	英語
DC.type' scheme='DCTERMS.DCMIType	text
DCTERMS.issued' scheme='DCTERMS.W3CDTF	2024-11
DC.relation' scheme='DCTERMS.URI	https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2024/DP1266.pdf
DC.subject	Full surplus extraction
	Crémer–McLean auction
	auction experiment
	evolutionary stability
	perturbed replicator dynamics
DCTERMS.abstract	The paradoxical full-surplus-extraction (FE) result, which can impair the mechanism design paradigm, is a long-standing concern in the literature. We tackle this problem by experimentally testing the performance of an FE auction, which is a second-price (2P) auction with lotteries. In the FE treatment, overbid amounts given entry increased and entry rates decreased through rounds, thus FE failed. By contrast, most subjects learned value bidding in the 2P treatment. To identify the causes of failure in the FE, we take an evolutionary-game approach. The FE auction with risk-neutral bidders has exactly two symmetric equilibria, either value bidding with full or partial entry, and only the partial-entry equilibrium is (evolutionarily or asymptotically) stable. Replicator dynamics with vanishing trends well explain observed dynamic bidding patterns. Together, these findings suggest that the FE outcome is not robust to trial-and-error learning by bidders.
DC.format	98513
citation_title	On the Performance of the Crémer–McLean Auction : An Experiment
citation_author	Nishimura, Takeshi
citation_author	Hanaki, Nobuyuki
citation_publisher	The Institute of Social and Economic Research, Osaka University
citation_language	英語
citation_date	2024-11
citation_journal_title	Institute of Social and Economic Research Discussion Papers
citation_volume	1266
citation_firstpage	1
citation_lastpage	45
citation_public_url	https://hdl.handle.net/11094/98513
citation_abstract_html_url	https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2024/DP1266.pdf

On the Performance of the Crémer–McLean Auction : An Experiment

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