Auctioning off a Non-Rivalrous Good with Interference

Auctioning off a Non-Rivalrous Good with Interference

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Auctions are a prevalent way to exchange goods and are Pastry Set well-studied for the exchange of rivalrous goods, but are less studied for non-rivalrous goods.I examine an auction framework where the good sold can be used simultaneously by multiple bidders if their use does not conflict with others; this simultaneous use directly affects the efficiency of the auction.A timely example includes the auctioning off of a radio spectrum by a licensed Bar Height Table Bases primary user to unlicensed secondary users who can use the spectrum simultaneously if they are located far enough apart to not cause interference.

I examine a uniform price auction over non-conflicting groups and examine how non-rivalry impacts both efficiency and collusion.Conditions are given under which an auction over groups generates higher social welfare than an individual auction.Additional conditions are given under which collusion in a group auction results in higher prices.