Becoming the Neighbor Bidder: Endogenous Winner's Curse in Dynamic Mechanisms

摘要

This paper addresses the problem of sequentially allocating time-sensitive goods, or one-period leases on a durable good, among agents who compete through time and learn about the common component of their valuation privately through experience. I show that efficiency is unattainable, and I identify simple variations of sequential second-price or English auctions that implement the second best and the revenue-maximizing auctions. When the units are divisible, I identify the corresponding auctions that allow for double sourcing. (JEL D44, D82)