All-Pay Auction
 |
Definition of 'All-Pay Auction'An economic and game theory concept in which participants place silent bids on a particular item. Unlike a standard auction, all-pay auction has everybody pay for their bid, regardless of whether they win the item being sold. Of course, in a standard auction, the highest bid wins the item. |
 |
Investopedia explains 'All-Pay Auction'An example of an all-pay auction is a Tullock auction, which is sometimes referred to as a Tullock lottery. Rather than being just another form of commerce, the Tullock auction and other all-pay auctions are largely intellectual pursuits, used to describe economic behaviors.For example, in a standard auction, a seller might expect to receive fair value for the goods he or she is offering. However, in an all-play auction, overbidding is common and the seller might expect to get better-than-fair value. |
Related Definitions
Articles Of Interest
-
The Auction Method: How NYSE Stock Prices are Set
The New York Stock Exchange (NYSE), sometimes referred to as “the big board,” is the oldest and largest stock exchange in the United States. NYSE is the place investors think of when ... -
The Closing Cross: How Nasdaq Stock Prices Are Set
When you hear that your favorite stock closed at a record high price, have you ever considered how that price was reached? The calculation effort is far more complex than you might expect. To ... -
The Nash Equilibrium
Nash Equilibrium is a key concept of game theory, which helps explain how people and groups approach complex decisions. Named after renowned mathematician John Nash, the idea of Nash Equilibrium ... -
The Opening Cross: How Nasdaq Stock Prices Are Set
The National Association of Securities Dealers Automated Quotations, commonly referred to as Nasdaq, is a computerized marketplace where stocks are traded from 9:30am to 4pm Eastern Standard ... -
Forces Behind Interest Rates
Get a deeper understanding of the importance of interest rates and what makes them change. -
The History Of The T-Bill Auction
Learn how the U.S. found the perfect solution to its debt problems and ended up creating one of the largest markets in the world. -
Tariffs
Tariffs, or customs duties, are taxes imposed on foreign goods and services. In addition to providing a country with additional revenue, tariffs offer protection to domestic producers. Imported ... -
Leading Economic Indicators Predict Market Trends
Leading indicators help investors to predict and react to where the market is headed. -
Great Company Or Growing Industry?
Look at the big picture when choosing a company - what you see may really be a stage in its industry's growth. -
Prisoner's Dilemma
Learn more about this classic game theory scenario.
Free Annual Reports