The role of information in U.S. offshore oil and gas lease auctions

Article Abstract:

The federal government auctions of offshore oil and gas leases from 1954 up to 1991 were analyzed to evaluate the predictive accuracy of decision models which highlight informational and strategic issues to account for the institutional traits of the leasing program. The formation of bidding consortia, the decision to bid, the government's decision to award to the highest bidder, the timing and incidence of exploratory drilling and other program features were examined and compared with model predictions. The results showed that the leasing program is well-designed.

Administration of Conservation Programs, Offshore Oil & Gas Leasing, Interpretation and construction, Petroleum industry, Contracts, Offshore oil fields, United States. Department of the Interior, Oil and gas leases, Mineral rights

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Common value auctions with insider information

Article Abstract:

First-price common value auctions where an insider is better informed than other bidders about the value of the item was studied with particular focus on bidding. Having an insider does not materially reduce the severity of the winner's curse compared to auctions with a symmetric information structure as is the case with inexperienced bidders. Super-experienced bidders, on the other hand, who have overcome the winner's curse, satisfy the static predictions of equilibrium bidding theory.

Research, Economic aspects, Letting of contracts, Competitive bidding, Insider trading in securities, Insider trading (Securities)

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On the failure of the linkage principle in multi-unit auctions

Article Abstract:

The failure of the linkage principle in multi-unit auctions has been studied. The linkage principle states that revenues are enhanced by always providing the bidders with as much information as possible about the value of the good. Results show that the linkage principle fails in multi-unit auctions because second-unit values are private and it is dominant to bid value on them, whether or not the seller's information is revealed.

Models

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