Competition in Treasury Auctions

Austria's EU accession led to an increase in the number of banks participating in treasury auctions. We use structural estimates of bidders' private values to examine the effect of increased competition on auction performance. As the results show, increased competition reduces bidder surplus substan...

Ausführliche Beschreibung

Bibliographische Detailangaben
Link(s) zu Dokument(en):WIFO Publikation
Veröffentlicht in:WIFO Working Papers
Hauptverfasser: Helmut Elsinger, Philipp Schmidt-Dengler, Christine Zulehner
Format: paper
Sprache:Englisch
Veröffentlicht: 2016
Schlagworte:
auction format, bidder surplus, competition, independent private values, multi-unit auctions, treasury auctions
Beschreibung
Zusammenfassung:Austria's EU accession led to an increase in the number of banks participating in treasury auctions. We use structural estimates of bidders' private values to examine the effect of increased competition on auction performance. As the results show, increased competition reduces bidder surplus substantially, but less than reduced form estimates would suggest. A significant component of the surplus reduction is due to more aggressive bidding. Counterfactuals establish that as competition increases, concerns regarding auction format play a smaller role.
Beschreibung:
  • 33 pages

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