Price Regulations in a Multi-unit Uniform Price Auction

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Price Regulations in a Multi-unit Uniform Price Auction

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Title: Price Regulations in a Multi-unit Uniform Price Auction
Author: Boom, Anette
Abstract: Inspired by recent regulations in the New York ICAP market, this paper examines the e ect of price regulations on a multi-unit uniform price auction. General bid caps reduce the maximum price below the bid cap, but also the minimum potential market price below the cap. A bid cap only for the larger rms does not guarantee a market price below the cap. A su ciently high bid oor only for relatively small rms destroys some or all pure strategy equilibria with equilibrium prices above the marginal costs. With a general bid oor this happens only with considerably larger bid oors.
URI: http://hdl.handle.net/10398/9245
Date: 2015-12-16
Notes: Paper presented at the 10th International Conference on Competition and Regulation (CRESSE 2015), Rethymnon, July 3-5, 2015

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