| Article ID: | iaor20062 |
| Country: | Netherlands |
| Volume: | 33 |
| Issue: | 5 |
| Start Page Number: | 531 |
| End Page Number: | 534 |
| Publication Date: | Sep 2005 |
| Journal: | Operations Research Letters |
| Authors: | Li Xiaohu |
The expected rent in a reverse (buyer's) auction is shown to be monotonically nonincreasing in the number of bidders if the distribution of valuations is decreasing reversed hazard rate (increasing failure rate). Conditions under which an increase in the spread of bids results in an increase in the expected rent are established as well.