Allotment in First-Price Auctions: An Experimental Investigation
We experimentally study the effects of allotment—the division of an item into homogeneous units—in independent private value auctions. We compare a bundling first-price auction with two equivalent treatments where allotment is implemented: a two-unit discriminatory auction and two simultaneous single-unit first-price auctions. We find that allotment in the form of a discriminatory auction generates a loss of efficiency with respect to bundling. In the allotment treatments, we observe large and persistent bid spread, and the discriminatory auction is less efficient than simultaneous auctions. We provide a unified interpretation of our results that is based on both a non-equilibrium response to the coordination problem characterizing the simultaneous auction format and a general class of behavioral preferences that includes risk aversion, joy of winning and loser’s regret as specific cases. © 2016 Economic Science Association
Germany was the first country in Europe that auctioned off spectrum in the valuable 700 MHz band for mobile telecommunication usage. The German regulator decided to sell this spectrum together with spectrum in the 900 MHz and 1800 MHz legacy bands. With only the three incumbent operators bidding in the auction and a relatively transparent auction design, it was possible to get a very clear impression of the actual bidding behaviour. We show that in the beginning of the auction, bidders were actively searching for a way to allocate the available spectrum that all bidders could agree to at low prices. Bidders were teaching each other what they should bid and were providing carrots and sticks. When the excess demand was concentrated in one band only, bidders started to compete head on leading to a war of attrition. This competition only stopped when bidders started to raise prices in bands that were already cleared. We interpret this bidding behaviour in terms of bidders expressing allocative externalities and conclude that the ability to do so may be regarded as a positive aspect of the transparent design.
We present results from an experiment with multiple public goods, where each good produces benefits only if total contributions to it reach a minimum threshold. The presence of multiple public goods makes coordination among participants more difficult, discouraging donor participation and decreasing the likelihood of any public good being effectively funded. Applied to the case of fundraising, the results show how overall donations and the number of effectively funded projects may both decrease as the total number of projects vying for funding increases. The analysis considers whether making one of the contribution options salient, either through its merits or by arbitrarily choosing one to feature during the experiment, helps overcome the increased coordination problem. The results have implications for the growing popularity of crowdfunding websites, and suggest benefits to these sites from helping donors compare and identify the most promising projects. © 2015 Elsevier B.V.
In 2004–2005 the Russian government started to implement the reform of public procurement. In order to decrease incentives to corruption and encourage competition, they established new procurement procedures. Meanwhile, according to the anecdotal evidence, since the decade of the reform, diff erent types of rent-seeking behavior have been still widespread in Russian procurement. In this article we conduct a comparative analysis of the procurement procedures in Federal Law 44 depending on the risks of rent-seeking behavior of public procurers and suppliers. We consider restrictions of competition to be indicators of corruption risks, i.e. the procurer’s rent-seeking behavior, and collusive practices (including imitation of collusion) and adverse selection to be indicators of the bidder’s rent-seeking behavior. At fi rst we describe Russian procurement procedures and then we employ the case-study in order to analyze in-depth risks of various forms of rent-seeking behavior. We fi nd that the risks of procurers’ rent-seeking behavior are negatively connected to the risks of suppliers’ rent-seeking. Some procurement procedures have more corruption risks, while others provide ample opportunities for collusion practices or an adverse selection. Basing on these results, we make recommendations to the regulator and to the government. First, the stimulating eff ect of monitoring will be higher under fi xed monitoring costs, if the regulator monitors more probable forms of rentseeking in each procurement procedure. Second, the social welfare will be highest, if the choice of procurement procedure is based not only on the product’s characteristics, but also on the market structure, including the risks of horizontal collusion.
Smoking is a problem, bringing signifi cant social and economic costs to Russiansociety. However, ratifi cation of the World health organization Framework conventionon tobacco control makes it possible to improve Russian legislation accordingto the international standards. So, I describe some measures that should be taken bythe Russian authorities in the nearest future, and I examine their effi ciency. By studyingthe international evidence I analyze the impact of the smoke-free areas, advertisementand sponsorship bans, tax increases, etc. on the prevalence of smoking, cigaretteconsumption and some other indicators. I also investigate the obstacles confrontingthe Russian authorities when they introduce new policy measures and the public attitudetowards these measures. I conclude that there is a number of easy-to-implementanti-smoking activities that need no fi nancial resources but only a political will.
One of the most important indicators of company's success is the increase of its value. The article investigates traditional methods of company's value assessment and the evidence that the application of these methods is incorrect in the new stage of economy. So it is necessary to create a new method of valuation based on the new main sources of company's success that is its intellectual capital.
The article is devoted to the study of the authoritarianism prevalent in the mass consciousness of Russians. The article describes a new approach to the consideration of the authoritarian syndrome as the effects of the cultural trauma as a result of political and socio-cultural transformation of society. The article shows the dynamics of the symptoms of the authoritarianism, which appear in the mass consciousness of Russians from 1993 to 2011. This paper proposes a package of measures aimed at reducing the level of the authoritarianism in Russian society.
This work looks at a model of spatial election competition with two candidates who can spend effort in order to increase their popularity through advertisement. It is shown that under certain condition the political programs of the candidates will be different. The work derives the comparative statics of equilibrium policy platform and campaign spending with respect the distribution of voter policy preferences and the proportionality of the electoral system. In particular, it is whown that the equilibrium does not exist if the policy preferences are distributed over too narrow an interval.
The article examines "regulatory requirements" as a subject of state control over business in Russia. The author deliberately does not use the term "the rule of law". The article states that a set of requirements for business is wider than the legislative regulation.
First, the article analyzes the regulatory nature of the requirements, especially in the technical field. The requirements are considered in relation to the rule of law. The article explores approaches to the definition of regulatory requirements in Russian legal science. The author analyzes legislation definitions for a set of requirements for business. The author concludes that regulatory requirements are not always identical to the rule of law. Regulatory requirements are a set of obligatory requirements for entrepreneurs’ economic activity. Validation failure leads to negative consequences.
Second, the article analyzes the problems of the regulatory requirements in practice. Lack of information about the requirements, their irrelevance and inconsistency are problems of the regulatory requirements in Russia.
Many requirements regulating economic activity are not compatible with the current development level of science and technology. The problems are analyzed on the basis of the Russian judicial practice and annual monitoring reports by Higher School of Economics.
Finally, the author provides an approach to the possible solution of the regulatory requirements’ problem. The author proposes to create a nationwide Internet portal about regulatory requirements. The portal should contain full information about all regulatory requirements. The author recommends extending moratorium on the use of the requirements adopted by the bodies and organizations of the former USSR government.