PROTECTING THE WINNER - 2ND-PRICE VERSUS ORAL AUCTIONS

In oral auctions, unlike sealed-bid second-price auctions, the winner never reveals his reservation price. We investigate bidders' strategies in the two auctions when third-parties can exploit information revealed by the auction. When exploitation is likely, oral auctions are more efficient than sealed-bid second-price auctions, and preferred by all participants. © 1991.