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Article

Information Revelation and Efficiency in Auctions

Economics Letters. 2004. No. 83. P. 277-284.
Mikoucheva A., Sonin K.

We study the impact of information revelation on efficiency in auctions. In a constrained-efficient mechanism, i.e. a mechanism that is efficient subject to the incentive-compatibility constraint, any additional information available to bidders increases the expected efficiency of the mechanism. This result cannot be extended to a more general setup: In a second-price sealed-bid auction, revelation of information might lead to efficiency losses.