Foto Huber

M. Sc. David Huber

Working Paper

Information Asymmetry and Private Values in Second Price Auctions



I propose an auction model which reflects a situation in which one bidder faces competitors who are much better informed about the prize's quality. Situations like this might occur in market entry situations like the recent 5G spectrum auction in Germany, where after intense bidding, a new market entrant managed to obtain a significant share of the spectrum. I extend the standard independent private value model to capture this type of information asymmetry and retrieve unique equilibrium predictions in undominated strategies. In a sealed bid format, the uninformed bidder is at a clear disadvantage and can predominantly only succeed in the auction if the object's quality is low. An open auction format can completely level the playing field, implementing the first best efficient outcome.

Curriculum Vitae

  • since 2017: PhD student and research assistant at the Chair of Political Economy (ECON)
  • 2015-2017: Master of Science in Applied Economics at the University of Innsbruck
  • 2008-2014: Bachelor of Science in Technical Mathematics at the University of Innsbruck