Scipediacontent: Scipediacontent moved page Draft Content 450699597 to Galetovic et al 2002a

2021-01-25T15:36:05Z

Scipediacontent moved page Draft Content 450699597 to Galetovic et al 2002a

Scipediacontent: Created page with " == Abstract == In many circumstances, a principal, who wants prices to be as low as possible, must contract with agents who would like to charge the monopoly price. This pap..."

2021-01-25T15:36:02Z

Created page with " == Abstract == In many circumstances, a principal, who wants prices to be as low as possible, must contract with agents who would like to charge the monopoly price. This pap..."

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== Abstract ==

In many circumstances, a principal, who wants prices to be as low as possible, must contract with agents who would like to charge the monopoly price. This paper compares a Demsetz auction, which awards an exclusive contract to the agent bidding the lowest price (competition for the field) with having two agents provide the good under (imperfectly) competitive conditions (competition in the field). We obtain a simple sufficient condition showing unambiguously which option is best. The condition depends only on the shapes of the surplus function of the principal and the profit function of agents, and is independent of the particular duopoly game played ex post. We apply this condition to three canonical examples -- procurement, royalty contracts and dealerships -- and find that whenever marginal revenue for the final good is decreasing in the quantity sold, a Demsetz auction is best. Moreover, a planner who wants to maximize social surplus also prefers a Demsetz auction.

== Original document ==

The different versions of the original document can be found in:

* [http://cowles.yale.edu/sites/default/files/files/pub/d13/d1358.pdf http://cowles.yale.edu/sites/default/files/files/pub/d13/d1358.pdf]

* [http://dx.doi.org/10.3386/w8869 http://dx.doi.org/10.3386/w8869]

* [http://hdl.handle.net/10419/98382 http://hdl.handle.net/10419/98382]

* [http://www.econ.yale.edu/growth_pdf/cdp844.pdf http://www.econ.yale.edu/growth_pdf/cdp844.pdf]

* [http://www.nber.org/papers/w8869.pdf http://www.nber.org/papers/w8869.pdf]

* [https://doi.org/10.3386/w8869 https://doi.org/10.3386/w8869]

* [https://www.nber.org/papers/w8869 https://www.nber.org/papers/w8869],
: [http://www.econ.yale.edu/growth_pdf/cdp844.pdf http://www.econ.yale.edu/growth_pdf/cdp844.pdf],
: [http://www.nber.org/papers/w8869.pdf http://www.nber.org/papers/w8869.pdf],
: [https://ideas.repec.org/p/egc/wpaper/844.html https://ideas.repec.org/p/egc/wpaper/844.html],
: [https://papers.ssrn.com/sol3/papers.cfm?abstract_id=305259 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=305259],
: [http://aida.wss.yale.edu/growth_pdf/cdp844.pdf http://aida.wss.yale.edu/growth_pdf/cdp844.pdf],
: [https://econpapers.repec.org/RePEc:egc:wpaper:844 https://econpapers.repec.org/RePEc:egc:wpaper:844],
: [https://www.econstor.eu/handle/10419/98382 https://www.econstor.eu/handle/10419/98382],
: [https://elischolar.library.yale.edu/cgi/viewcontent.cgi?article=1851&context=egcenter-discussion-paper-series https://elischolar.library.yale.edu/cgi/viewcontent.cgi?article=1851&context=egcenter-discussion-paper-series],
: [https://elischolar.library.yale.edu/egcenter-discussion-paper-series/852 https://elischolar.library.yale.edu/egcenter-discussion-paper-series/852],
: [https://m.nber.org/papers/w8869 https://m.nber.org/papers/w8869],
: [https://ageconsearch.umn.edu/record/28406 https://ageconsearch.umn.edu/record/28406],
: [https://academic.microsoft.com/#/detail/1868523257 https://academic.microsoft.com/#/detail/1868523257]

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Galetovic et al 2002a - Revision history

Scipediacontent: Scipediacontent moved page Draft Content 450699597 to Galetovic et al 2002a

Scipediacontent: Created page with " == Abstract == In many circumstances, a principal, who wants prices to be as low as possible, must contract with agents who would like to charge the monopoly price. This pap..."