New Auction Design Maximizes Revenue by Favoring Lower Bidders
The article explores how to design auctions when bidders have a common value based on their signals. The optimal mechanism involves bidders paying independently of their signals, with lower signal bidders favored in the allocation. The best approach is a posted price where all bidders have an equal chance of winning. This model can also be seen as a resale scenario, where bidders with private values can make offers in a secondary market.