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Contribution Details

Type Working Paper
Scope Discipline-based scholarship
Title Pay-as-bid: selling divisible goods
Organization Unit
  • Marek Pycia
  • Kyle Woodward
  • English
Institution SSRN eLibrary
Series Name SSRN
Number 2417512
ISSN 1556-5068
Number of Pages 55
Date 2016
Abstract Text Pay-as-bid is the most popular auction format for selling treasury securities. We prove the uniqueness of pure-strategy Bayesian-Nash equilibria in pay-as-bid auctions where symmetrically-informed bidders face uncertain supply, and we establish a tight sufficient condition for the existence of this equilibrium. Equilibrium bids have a convenient separable representation: the bid for any unit is a weighted average of marginal values for larger quantities. With optimal supply and reserve price, the pay-as-bid auction is revenue-equivalent to the uniform-price auction.
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Digital Object Identifier 10.2139/ssrn.2417512
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