NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

NBER Working Papers by James W. Roberts

Contact and additional information for this authorAll publicationsWorking Papers only

Working Papers

August 2013Regulating Bidder Participation in Auctions
with Vivek Bhattacharya, Andrew Sweeting: w19352
Regulating bidder participation in auctions can potentially increase efficiency compared to standard auction formats with free entry. We show that the relative performance of two such mechanisms, a standard first-price auction with free entry and an entry rights auction, depends non-monotonically on the precision of information that bidders have about their costs prior to deciding whether to participate in a mechanism. As an empirical application, we estimate parameters from first-price auctions with free entry for bridge-building contracts in Oklahoma and Texas and predict that an entry rights auction increases efficiency and reduces procurement costs significantly.
November 2011When Should Sellers Use Auctions?
with Andrew Sweeting: w17624
A bidding process can be organized so that offers are submitted simultaneously or sequentially. In the latter case, potential buyers can condition their behavior on previous entrants' decisions. The relative performance of these mechanisms is investigated when entry is costly and selective, meaning that potential buyers with higher values are more likely to participate. A simple sequential mechanism can give both buyers and sellers significantly higher payoffs than the commonly used simultaneous bid auction. The findings are illustrated with parameters estimated from simultaneous entry USFS timber auctions where our estimates predict that the sequential mechanism would increase revenue and efficiency.
February 2011Speculators and Middlemen: The Role of Intermediaries in the Housing Market
with Patrick Bayer, Christopher Geissler: w16784
We document and study the strategy and performance of two distinct types of investors in Los Angeles between 1988-2009 who purchased homes with the intention of quickly re-selling: middlemen buy at below-market prices from motivated sellers and re-sell quickly; speculators target periods and areas of rapid market appreciation. Unlike that of middlemen, speculative activity increased sharply in the housing boom and was strongly associated with subsequent price bubbles at both the metropolitan and neighborhood levels. We present evidence suggesting that speculation fueled excess short-term appreciation rather than reflected the ability of speculators to predict when and where such appreciation would occur.
December 2010Bailouts and the Preservation of Competition
with Andrew Sweeting: w16650
Governments rescue private companies partly to prevent other firms from gaining excessive market power. However, if failing firms exit, new entry may limit remaining firms' market power if there are potential entrants who can be as effective competitors as the firms leaving the market. We quantify these effects in the case of the 1984 bailout of timber companies that faced substantial losses on existing federal timber contracts. We predict that the bailout substantially increased sale prices in subsequent auctions because firms that might have might have been induced to enter without the bailout tended to have relatively low values.

Contact and additional information for this authorAll publicationsWorking Papers only

 
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