Abstract
We consider sequential auction of two identical objects under the second-price rule when reserves are set optimally. We find that bidders bid more in the sequential auction when they are risk averse (CARA) than when they are not. The expected revenue is higher under the Vickrey rule than under the uniform-price rule. Hence the sequential auction generates higher expected revenue than both the Vickrey auction and uniform-price auction when bidders have constant absolute risk aversion.
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