Open vs Sealed Bid Auctions: Testing for Revenue Equivalence under Singapore's Vehicle Quota System

Open vs Sealed Bid Auctions: Testing for Revenue Equivalence under Singapore's Vehicle Quota System

Using data from the auction of vehicle quota licenses in Singapore, we study if revenue equivalence holds when the auction format was switched from a sealed-bid format (May 1990 to June 2001) to an open bidding format since July 2001. Our econometric analysis indicates the change in auction format l...

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Bibliographic Details
Main Authors: MARIANO, Roberto S., KOH, Winston T. H., TSE, Yiu Kuen
Format: text
Language:English
Published: Institutional Knowledge at Singapore Management University 2007
Subjects:
Asian Studies
Behavioral Economics
Econometrics
Public Affairs, Public Policy and Public Administration
Transportation
Online Access:https://ink.library.smu.edu.sg/soe_research/25
https://ink.library.smu.edu.sg/context/soe_research/article/1024/viewcontent/Open_vs_sealed_bid_auctions_Singapore_vehicle_quota_system.pdf
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Institution: Singapore Management University
Language: English
Description
Summary:Using data from the auction of vehicle quota licenses in Singapore, we study if revenue equivalence holds when the auction format was switched from a sealed-bid format (May 1990 to June 2001) to an open bidding format since July 2001. Our econometric analysis indicates the change in auction format led to a change in bidding behavior. On average, the quota license premium under the open bidding format is about US$1000 (about 7.5% of the Category E license price in June 2001) lower, compared to the forecast level that would have prevailed if there had been no change in the auction format.

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