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on Game Theory |
| By: | Dubra, Juan |
| Abstract: | I introduce a property of player's valuations that ensures the existence of an ex post efficient equilibrium in asymmetric English auctions. The use of this property has the advantage of yielding an ex post efficient equilibrium without assuming differentiability of valuations or that signals are drawn from a density. These technical, non economic, assumptions have been ubiquitous in the study of (potentially) asymmetric English auctions. Therefore, my work highlights the economic content of what it takes to obtain efficient ex post equilibria. I generalize prior work by Echenique and Manelli (2006) and by Birulin and Izmalkov (2003). Relative to Krishna (2003), I weaken his single crossing properties, drop his differentiability and densities assumptions, but I assume that one player's valuation is weakly increasing in other players' signals, while he uses a different assumption (neither stronger nor weaker). |
| Keywords: | Efficiency; English Auctions; ex-post equilibrium |
| JEL: | D44 D82 C72 |
| Date: | 2006–10–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:702&r=gth |
| By: | Stéphane Mahuteau (Department of Economics, Macquarie University) |
| Abstract: | We investigate to what extent reciprocity, exhibited by employers and employees, lead to stable gift exchange practices in the labour contract, giving rise to non-compensating wage differentials among industries and firms. We use the concept of Sequential Reciprocity Equilibrium (Dufwenberg and Kirchsteiger 1998, 2004) to incorporate players’ preferences for reciprocity in their utility function. We show that successful gift exchange practices may arise if both players actually care for reciprocity. We test the predictions of the model using a matched employer-employee French dataset. Our results show that French employers and employees’ decisions are influenced by reciprocity concerns. |
| Keywords: | reciprocity, fairness, sequential game, cheap-talk, efficiency wages |
| JEL: | C72 J33 J41 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:mac:wpaper:0609&r=gth |