Optimal auctions with asymmetrically informed bidders

Summary. The paper analyzes a problem of optimal auction design when the seller faces asymmetrically informed bidders. Specifically, we consider a continuum of risk-neutral uninformed bidders taking part into the auction along with n risk-averse informed bidders. The contribution of the paper is threefold. First, we fully characterize the optimal auction in this non standard environment and in a very general set-up. We find that when informed bidders reveal “bad news” about the value of the good, the seller optimally awards the object to the uninformed bidders. Secondly, we show that the seller is better off in presence of uninformed bidders because this allows to lower the informational rents paid to the informed bidders. Last, we find that, with bi-lateral risk neutrality, the seller always awards the good to the uninformed bidders thereby keeping all the surplus.Received: 22 October 2004, Revised: 21 April 2005, JEL Classification Numbers: D44, D82.We are very grateful to two anonymous referees, Jacques Crémer, Patrick François, Angel Hernando-Veciana and seminar participants at the 2004 SCSE conference (Quebec, Canada) for their valuable comments. Moez Bennouri acknowledges the financial support by the Initiative of the New Economy (INE) program of SSHRC (Canada).     

Working for the family

Recent writing about the ‘service encounter’ suggests that high-quality service requires employee commitment and this will involve a more developed and sophisticated approach to HRM than has traditionally characterised the sector. Through an in-depth study of a sample of high service level hotels in the US and UK this paper argues, in contrast, that commitment can be created through a workplace culture that draws on family discourses and practices. It explores the ways in which this culture is developed and endorsed by both management and employees. This approach to generating commitment has costs in terms of the time and priority employees can give to their ‘real’ friends and family. By drawing on the highly gendered and hierarchical organisation of the family, it is argued that culture also contributes to gender stereotyping and hierarchies within and outside the workplace in ways that limit women's career opportunities.     

Sunspot-like equilibria in an overlapping generations economy with strategic interactions

In this paper I analyze the effect of market uncertainty in an overlapping generations economy with strategic interactions among agents. I demonstrate the existence of sunspot-like equilibria, in which arbitrarily small amounts of intrinsic uncertainty in agents’ offers generate large fluctuations in equilibrium bids and prices. I would like to express my gratitude to Stephen Spear for his guidance during the realization of this project. I thank an anonymous referee for providing insightful comments and suggestions. I have benefited from comments by Alexander Elbittar, Cesar Guerrero, and Vivek Ramachandran.     

Uncertainty and insurance in strategic market games

Summary. For perfectly competitive economies under uncertainty, there is a well-known equivalence between a formulation with contingent goods and one with state-specific securities followed by spot markets for goods. In this paper, I examine whether this equivalence carries over to a particular form of imperfect competition. Specifically, I look at three Shapley-Shubik strategic market games: one with contingent commodities, one with Arrow securities traded under imperfect competition and one with Arrow securities traded under perfect competition. First I compare the feasibility constraints of these three games. Then I compare their equilibrium sets. As in Peck and Shell (1989), the only common equilibria between the first and the second game are those which involve no transfer of income across states. However, if the securities markets are competitive, then the set of equilibria of the contingent commodities game and the securities game coincide. Received: June 16, 1997; revised version: April 30, 1998     

An assessment of hierarchical linear modeling in international business,management, and marketing

International marketing research, in most cases, involves at least two levels (e.g., firms within countries) that make the hierarchical linear modeling (HLM) a suitable data analysis technique. Due to its robustness, the use of HLM in the international business (IB) research has increased substantially over the last decade. However there is still a lack of standardization in the fundamental issues that hinders the wide spread use of HLM. This study provides unified approach to HLM use in IB research by providing standards for appropriate use of HLM. To achieve this goal, a detailed analysis of the method's use in 42 IB studies is provided and these studies are compared with 104 non-international studies to determine where IB research stands in terms of HLM use. Finally this study focuses on the good HLM practices and offers suggestions designed to maximize the effective use of HLM and potential in international business studies.     

Application of factor models for the identification of countries sharing international reference-cycles

Using the methodology developed in Stock and Watson (2002a), this paper proposes to exploit the information that contains the factor loading to identify the countries sharing common factors. The proposal is illustrated by analyzing the relation with the international reference-cycle of a large sample of advanced countries from 1950 until 2006.     

Developments in Union Recognition and Derecognition in Britain, 1994–1998

This research note shows a marked change in the relative incidence of cases of derecognition and recognition in the period 1994–1998. It shows that the level of derecognition has fallen significantly in recent years while that of the signing of new recognition agreements has continued at its former level, so that on balance new recognition agreements clearly outnumber cases of derecognition. The context and reasons for this are explained by reference to developments in public policy, employer views and union practice. The results of derecognition and the prospects for union recognition are also examined.     

State,war, and land dispossession: The multiple paths to land concentration

We focus on the role of the state in land dispossession during war. State agencies promote land accumulation not only through coercive paths, but also by combining political and market mechanisms. Each mechanism may link the state with different actors and coalitions. We illustrate how this worked in Tibú, a Colombian municipality in which violence against civilians and land accumulation took place in more or less distinct phases. The case highlights the fact that land accumulation during war is not only achieved through coercion. At the same time, it shows the importance of identifying the specific coalitions through which states establish their presence in contested territories during war. We explain such variation as resulting from the types of alliances and coalitions that the state establishes with different sets of stakeholders, and the aims pursued by coalition actors.     

Testing for structural breaks in factor loadings: An application to international business cycle

This paper proposes the implementation of the SupWald test of Andrews (1993) to detect structural breaks in the loadings of a static factor model. The procedure is illustrated by testing for structural breaks in the common factors of GDP growth series for a sample of advanced countries from 1950 until 2006.