Bidders’ Risk Preferences in Discriminative Auctions

Yonghong Long

We study multiple unit Discriminative auctions when the bidders share log-concave utility functions and investigate the effects of bidders risk preferences on their bid functions when all bidders share a common utility function and when the bidders exhibit different risk preferences. We extend the existing findings from single unit auctions to multiple unit Discriminative auctions, from concave utility functions to log-concave utility functions, and from identical preference to different preferences.

Key Words: Auction; Bid function; Risk preference.
JEL Classification Numbers: D44, D72, D82.