This short paper is concerned with the welfare effect of competition in one-object auction contexts in which bidders' valuations are interdependent and bidders' private information-may be multidimensional. Specifically, we focus on two auction formats: the sealed-bid second price auction and the open ascending price auction. We consider contexts in which bidders' valuations have a private and a common element, and in which bidders know their own private element and are differentially informed about the common element. For each auction format, we are interested in the welfare effect of adding one more bidder at the auction stage when the identity of participants, and information structures are all assumed to be common knowledge among bidders.
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