On the Clock of the Combinatorial Clock Auction

Maarten Janssen, Bernhard Kasberger

Publications: Working paper

Abstract

The Combinatorial Clock Auction (CCA) has been frequently used in recent spectrum auctions. It combines a dynamic clock phase with subsequent VCG pricing in order to maximize price discovery and efficiency. We inquire into the role of the clock when bidders have lexicographic preferences for raising rivals' costs. All equilibria of the CCA are inefficient if there is substantial room for price discovery, that is, if there is large uncertainty concerning the competitor's type. Conversely, in all efficient equilibria price discovery is limited. Qualitative features of our equilibria are in line with evidence concerning bidding behavior in some recent CCAs.
Original languageEnglish
Number of pages50
Publication statusPublished - Jul 2016

Publication series

SeriesVienna Economics Papers
NumberNo.1607

Austrian Fields of Science 2012

  • 502021 Microeconomics

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