Profit-share bidding auctions: a theoretical approach

Neste trabalho, estudamos o regime de partilha de produção brasileiro, instituí do pela Lei No 12.351, para exploração de petróleo através de uma abordagem te orica. Desenvolvemos um modelo de partilha de produção a fim de capturar algumas características do modelo de partilha brasileiro como, por exemplo, a participação obrigatória da Petrobras, assimetria de informação e a presença de participantes estratégicos. Através de solução numérica, fazemos uma análise das estratégias dos participantes e dos ganhos esperados. Além disso, desenvolvemos um modelo de custos heterogêneos para estudar as regras de conteúdo local.

Leilões de valor quase comum e o regime de partilha de produção brasileiro: uma abordagem teórica

Neste trabalho, estudamos o regime de partilha de produção brasileiro, instituído pela Lei N$^o$ 12.351, para exploração de petróleo através de uma abordagem teórica. Alguns artigos da literatura de leilões de valor quase comum foram estudados aqui. Além disso, desenvolvemos um modelo de partilha de produção com informação assimétrica a fim de capturar algumas características do modelo de partilha brasileiro. Através de solução numérica, fazemos uma análise das estratégias dos participantes e dos ganhos esperados.

On information and competition in private value auctions

How much information does an auctioneer want bidders to have in a private value environment?We address this question using a novel approach to ordering information structures based on the property that in private value settings more information leads to a more disperse distribution of buyers updated expected valuations. We define the class of precision criteria following this approach and different notions of dispersion, and relate them to existing criteria of informativeness. Using supermodular precision, we obtain three results: (1) a more precise information structure yields a more efficient allocation; (2) the auctioneer provides less than the efficient level of information since more information increases bidder informational rents; (3) there is a strategic complementarity between information and competition, so that both the socially efficient and the auctioneer s optimal choice of precision increase with the number of bidders, and both converge as the number of bidders goes to infinity.

Abstract types and distributions in independent private value auctions

In this note, in an independent private values auction framework, I discuss the relationship between the set of types and the distribution of types. I show that any set of types, finite dimensional or not, can be extended to a larger set of types preserving incentive compatibility constraints, expected revenue and bidder’s expected utilities. Thus for example we may convexify a set of types making our model amenable to the large body of theory in economics and mathematics that relies on convexity assumptions. An interesting application of this extension procedure is to show that although revenue equivalence is not valid in general if the set of types is not convex these mechanism have underlying distinct allocation mechanism in the extension. Thus we recover in these situations the revenue equivalence.

Share bidding auctions, sliding scale royalty rates and the new brazilian regulatory framework for the pre-salt areas

O governo brasileiro recentemente aprovou uma legislação instituindo um novo marco regulatório para as reservas petrolíferas do pré-sal. Segundo as novas regras, estas áreas deverão ser licitadas mediante um leilão de partilha de lucro. Motivado por esta mudança, apresentamos um modelo de leilão de partilha sob afiliação, demonstrando a existência de um equilíbrio monótono em estratégias puras e caracterizando a solução. Alem disso, provamos que este mecanismo gera receita esperada maior ou igual a um leilão de primeiro preço usual. Em seguida, introduzimos no modelo uma função representando taxas de royalties que dependem do valor do objeto. Este instrumento permite uma elevação na receita esperada de ambos os modelos, fazendo com que a diferença entre eles encolha. Finalmente, analisando o novo marco regulatório sob o ponto de vista dos resultados obtidos, concluímos que o antigo modelo de concessão utilizado pelo governo brasileiro é mais adequado e lucrativo.

Auctions for government securities: a laboratory comparison of uniform, discriminatory and spanish designs

The Bank of Spain uses a unique auction format to sell government bonds, which can be seen as a hybrid of a uniform and a discriminatory auction. For winning bids above the average winning bid, buyers are charged the average winning bid, otherwise they pay their respective bids. We report on an experiment that compares this auction format to the discriminatory format, used in most other countries, and to the uniform format. Our design is based on a common value model with multi-unit supply and two-unit demand. The results show significantly higher revenue with the Spanish and the uniform formats than with the discriminatory one, while volatility of prices over time is significantly lower in the discriminatory format than in the Spanish and uniform cases. Actual price dispersion is significantly larger in the discriminatory than in the Spanish. Our data also exhibit the use of bid-spreading strategies in all three designs.

Possible consequences of increasing life expectancy in Brazil: the perspective of a European historical demographer

Those over sixty years of age accounted for 6.6% of the total population of Brazil in 1985, in the Federal Republic of Germany this proportion was 20.3% in 1984. As early as 1950 it had been 14.5%. This proportion will not even be reached in Brazil in the year 2000 when persons aged sixty years and older are only projected to make up 8.8% of the total population. Similarly, in 1982/84 life expectancy at birth in the Federal Republic was 70.8 years for men and 77.5 for women; in Brazil the figures for 1980/85 were, by contrast, "only" 61.0 and 66.0. Against this background it is easy to understand why the discussion concerning an ageing society with its many related medical, economic, individual and social problems has been so slow in coming into its own in Brazil. As important as a more intensive consideration of these aspects may be in Brazil at present, they are, nevertheless, only one side of the story. For a European historical demographer with a long-term perspective of three of four hundred years, the other side of the story is just as important. The life expectancy which is almost ten years lower in Brazil is not a result of the fact that no one in Brazil lives to old age. In 1981 people sixty-five years and older accounted for 34.4% of all deaths! At the same time infants accounted for only 22.1% of total mortality. They are responsible, along with the "premature" deaths among youths and adults, for the low, "average" life expectancy figure. In Europe, by contrast, these "premature" deaths no longer play much of a role. In 1982/84 more than half of the women (52.8%) in the Federal Republic of Germany lived to see their eightieth birthdays and almost half of the men (47.3%) lived to see their seventy-fifth. Our biological existence is guaranteed to an extent today that would have been unthinkable a few generations ago. Then, the classic troika of "plague, hunger and war" threatened our forefathers all the time and everywhere. The radical transition from the formerly uncertain to a present-day certain lifetime, which is the result of the repression of "plague, hunger and war", led to unexpected consequences for our living together. Our forefathers were forced to live in closely knit Gemeinschaften in the interest of physical survival and to subordinate their egoistic goals to a common value, but now these pressures have, for the most part, fallen away. Correspondingly, this much more certain EGO has taken center stage. An ever greater number of us chooses to live life as single beings: the number of marriages is lower every year; the number of divorces is on the increase; in Berlin (West) more than half (sic! 52.3%) of all households are already composed on only one person. For the last dozen years the annual number of births in the Federal Republic has been insufficient to ensure population replacement. Not a population explosion but rather the opposite, a population implosion, is our problem. Human beings do not appear to be "social animals", as was axiomatically assumed for so long. They were only forced to behave as such for as long as "plague, hunger and war" forced them to do so. When these life endangering conditions no longer exist and life becomes certain even without their being integrated into a Gemeinschaft then humans suddenly show themselves more and more to be independent single beings. It is not the percentage of the population that is over sixty or sixty-five that is decisive in this context but rather how certain adults perceive their biological lives to be, since they are the ones who organize their lives, who build communities or who are ever more often willing only to enter into means-to-an-end personal unions without lasting or close ties and mutual responsibilities. There are many signs which seem to point to a development in this direction in Brazil as well. More and more adults in Brazil are caught up in the deep-seated transition from an uncertain to a certain lifetime. A third of them die after having reached their sixty-fifth birthday. It therefore seems to me to be high time that one began to give more consideration to the other side of the story in Brazil as well. And who is more suited intensively to consider the long-term perspectives than those engaged in the public health sector in whose competence, after all, such aspects, as "life certainty", "life expectancy" and "age at death" belong?

Models and tools for value systems analysis in collaborative environments

Dissertation to obtain the degree of Doctor in Electrical and Computer Engineering, specialization of Collaborative Networks

All-pay auction equilibria in contests

We analyze (non-deterministic) contests with anonymous contest success functions. There is no restriction on the number of contestants or on their valuations for the prize. We provide intuitive and easily verifiable conditions for the existence of an equilibrium with properties similar to the one of the (deterministic) all-pay auction. Since these conditions are fulfilled for a wide array of situations, the predictions of this equilibrium are very robust to the specific details of the contest. An application of this result contributes to fill a gap in the analysis of the popular Tullock rent- seeking game because it characterizes properties of an equilibrium for increasing returns to scale larger than two, for any number of contestants and in contests with or without a common value. Keywords: (non-) deterministic contest, all-pay auction, contest success functions. JEL Classification Numbers: C72 (Noncooperative Games), D72 (Economic Models of Political Processes: Rent-Seeking, Elections), D44 (Auctions).

Winner's curse in toll road concessions

We empirically assess the effect of the winner's curse in auctions for toll road concessions, taking into account, to our knowledge for the first time, problems of commitment and enforcement, using a unique dataset of 49 worldwide road concessions.

Subjectivity in the valuation : Case study on the Finnish biotechnology industry

The thesis combines valuation and behavioral economics literature, which is not common among the Finnish management accounting research. Furthermore, the valuation is studied in biotechnology context and those type of studies are rather rare as well. The thesis studies the valuation in the Finnish biotechnology industry. The concepts of behavioral finance are employed in the empirical part of the study to explore decision-makers’ behavior in valuation processes. The main interest of this study is to explore how subjectivity of a decision-maker affects the valuation in the biotechnology industry. The valuation is studied from two perspectives. First, what is the best valuation model for biotechnology companies suggested by the valuation literature? Second, how the valuation in biotechnology industry is done in practice and how the decision-makers subjectivity affects the valuation? The literature review aims at seeking the best valuation model. The real options were found to be the most suitable valuation model for biotechnology companies, especially in the early stages of product development. The real option’s ability to take the value of the inherent options into account results in theoretically most correct valuations. The only disadvantage is the model’s complexity when compared to other models, such as discounted cash flow models. The empirical part of the study consists of a case study, which examines the valuation practices of the Finnish biotechnology companies. When it comes to the valuation models used in practice, it was found that the companies were using rather simple valuation models, which was due to two reasons. First, the interviewees did not believe in the valuation models and second, they were familiar neither with the most sophisticated models nor with all the theoretical aspects of the models they were using. The material for the study was collected with theme interviews. Four CEO’s of highly successful Finnish biotechnology companies. Strong signs of the decision-makers’ subjectivity in valuation were observed. Most obvious were the signs of framing. Furthermore, herding, excessive optimism, and overconfidence were present. All the behavioral concepts observed most likely have a severe effect on the valuation. As a result, the valuation can easily become overly optimistic, which leads to overvalued investments and to continuation of already unprofitable projects. Framing had the strongest evidence. If the product being valued is framed successfully, the risk of overvaluation is high, thus a strong belief can justify almost any value.

Value co-creation in bio-based chemicals value network

The purpose of this Master’s thesis is to study value co-creation in emerging value network. The main objective is to examine how value is co-created in bio-based chemicals value network. The study provides insights to different actors’ perceived value in the value network and enlightens their motivations to commit to the collaborative partnerships with other actors. Empirical study shows that value co-creation is creation of mutual value for both parties of the relationship by combining their non-competing resources to achieve a common goal. Value co-creation happens in interactions, and trust, commitment and information sharing are essential prerequisites for value co-creation. Value co-creation is not only common value creation, but it is also value that emerges for each actor because of the co-operation with the other actor. Even though the case companies define value mainly in economic terms, the other value elements like value of the partnership, knowledge transfer and innovation are more important for value co-creation.

Affiliation, equilibrium existence and the revenue ranking of auctions

We consider private value auctions where bidders’ types are dependent, a case usually treated by assuming affiliation. We show that affiliation is a restrictive assumption in three senses: topological, measure-theoretic and statistical (affiliation is a very restrictive characterization of positive dependence). We also show that affiliation’s main implications do not generalize for alternative definitions of positive dependence. From this, we propose new approaches to the problems of pure strategy equilibrium existence in first-price auctions (PSEE) and the characterization of the revenue ranking of auctions. For equilibrium existence, we slightly restrict the set of distributions considered, without loss of economic generality, and offer a complete characterization of PSEE. For revenue ranking, we obtain a characterization of the expected revenue differences between second and first price auctions with general dependence of types.

Nonparametric Identication and Structural Estimation of Auction Models

Thesis (Ph.D.)--University of Washington, 2016-06

Essays on robust mechanism design

Chapter 1: Under the average common value function, we select almost uniquely the mechanism that gives the seller the largest portion of the true value in the worst situation among all the direct mechanisms that are feasible, ex-post implementable and individually rational. Chapter 2: Strategy-proof, budget balanced, anonymous, envy-free linear mechanisms assign p identical objects to n agents. The efficiency loss is the largest ratio of surplus loss to efficient surplus, over all profiles of non-negative valuations. The smallest efficiency loss is uniquely achieved by the following simple allocation rule: assigns one object to each of the p−1 agents with the highest valuation, a large probability to the agent with the pth highest valuation, and the remaining probability to the agent with the (p+1)th highest valuation. When “envy freeness” is replaced by the weaker condition “voluntary participation”, the optimal mechanism differs only when p is much less than n. Chapter 3: One group is to be selected among a set of agents. Agents have preferences over the size of the group if they are selected; and preferences over size as well as the “stand-outside” option are single-peaked. We take a mechanism design approach and search for group selection mechanisms that are efficient, strategy-proof and individually rational. Two classes of such mechanisms are presented. The proposing mechanism allows agents to either maintain or shrink the group size following a fixed priority, and is characterized by group strategy-proofness. The voting mechanism enlarges the group size in each voting round, and achieves at least half of the maximum group size compatible with individual rationality.