American Economic Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
Symmetric Equilibrium in Pre-auction Investment
American Economic Journal: Microeconomics
(pp. 377–414)
Abstract
We characterize the symmetric equilibria of a pre-auction game of investment in an internet ad auction environment. For a wide class of auction formats, we show a symmetric equilibrium exists for the pre-auction investment game, is essentially unique, and is the same for all auction formats in the class. We give sufficient conditions for the symmetric equilibrium to be in pure strategies and to achieve the efficient level of investment. Finally, we show comparative statics results with respect to a variety of parameters.Citation
Quint, Daniel, and Fuhito Kojima. 2026. "Symmetric Equilibrium in Pre-auction Investment." American Economic Journal: Microeconomics 18 (4): 377–414. DOI: 10.1257/mic.20250013Additional Materials
JEL Classification
- D44 Auctions
- D82 Asymmetric and Private Information; Mechanism Design