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Entry-proofness and discriminatory pricing under adverse selection

Attar, Andrea, Mariotti, Thomas and Salanié, François (2017) Entry-proofness and discriminatory pricing under adverse selection. TSE Working Paper, n. 17-788, Toulouse

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Official URL : http://tse-fr.eu/pub/31582

Abstract

This paper studies competitive allocations under adverse selection. We rst provide a general necessary and sucient condition for entry on an inactive market to be unprotable. We then use this result to characterize, for an active market, a unique budget-balanced allocation implemented by a market tari making additional trades with an entrant unprotable. Motivated by the recursive structure of this allocation, we nally show that it emerges as the essentially unique equilibrium outcome of a discriminatory ascending auction. These results yield sharp predictions for competitive nonexclusive markets

Item Type: Monograph (Working Paper)
Language: English
Date: March 2017
Place of Publication: Toulouse
Uncontrolled Keywords: Adverse Selection, Entry-Proofness, Discriminatory Pricing, Nonexclusive, Markets, Ascending Auctions
JEL Classification: D43 - Oligopoly and Other Forms of Market Imperfection
D82 - Asymmetric and Private Information
D86 - Economics of Contract - Theory
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse), TSM Research (Toulouse)
Institution: Université Toulouse 1 Capitole
Site: UT1
Date Deposited: 24 Mar 2017 13:33
Last Modified: 01 Apr 2021 07:59
OAI Identifier: oai:tse-fr.eu:31582
URI: http://publications.ut-capitole.fr/id/eprint/23268

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