Speaker: Xinyi Xu

Topic:  Optimal royalty auction with seller’s post-auction investment

Abstract: We consider royalty auctions with each bidder’s payoff upon winning endogenously determined by his type and seller post-auction input. In charactering an optimal royalty auction mechanism, differ from standard approach, we first derive an upper bound value of seller’s expected payoff among all feasible mechanisms, then provide a mechanism which can obtain the upper bound value, called the optimal royalty auction mechanism. The optimal mechanism selects the bidder of the highest type among all participants provided that is greater than the threshold type, and recommends a post-auction effort as a function of the winner’s type. We show that first-price auction with full information disclosure rule can implement the optimal royalty auction mechanism.

Location:  via Zoom; Room 318

Meeting Time: Apr. 15th, 2021, 8:30-9:30am CST; Apr. 14th, 2021, 8:30-9:30pm EST