Abstract
We analyze the eects of dierent resale mechanisms in multi-object uniform-price auc- tions with asymmetric bidders. The possibility of resale aects bidders'strategies, and hence the allocation of the objects on sale. Our experimental design consists of four treatments: one without resale and three resale treatments that vary the information available and the bargaining mechanism in the resale market. As predicted by theory: (i) without resale, asymmetry among bidders reduces demand reduction; (ii) the presence of a resale market, regardless of its structure, increases demand reduction by high-value bidders and speculation by low-value bidders, thus reducing auction e¢ ciency. Low-value bidders always prefer resale to be allowed, but high-value bidders may not. In contrast to what is usually argued, resale does not necessarily increase …nal e¢ ciency and may not reduce the seller's revenue. Features of the resale market that tend to increase its e¢ ciency also reduce auction e¢ ciency and the seller's revenue.
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