Testing affiliation in private-values models of first-price auctions using grid distributions
Applications
2011-01-10 v1
Abstract
Within the private-values paradigm, we construct a tractable empirical model of equilibrium behavior at first-price auctions when bidders' valuations are potentially dependent, but not necessarily affiliated. We develop a test of affiliation and apply our framework to data from low-price, sealed-bid auctions held by the Department of Transportation in the State of Michigan to procure road-resurfacing services: we do not reject the hypothesis of affiliation in cost signals.
Cite
@article{arxiv.1101.1398,
title = {Testing affiliation in private-values models of first-price auctions using grid distributions},
author = {Luciano I. de Castro and Harry J. Paarsch},
journal= {arXiv preprint arXiv:1101.1398},
year = {2011}
}
Comments
Published in at http://dx.doi.org/10.1214/10-AOAS344 the Annals of Applied Statistics (http://www.imstat.org/aoas/) by the Institute of Mathematical Statistics (http://www.imstat.org)