@article{Identification:1337,
      recid = {1337},
      author = {Schurter, Karl},
      title = {Identification and Inference in First-Price Auctions with  Collusion},
      publisher = {The University of Chicago},
      school = {Ph.D.},
      address = {2017-06},
      pages = {111},
      abstract = {This dissertation develops a method to detect collusion  and estimate its effect on the seller's revenue in  first-price auctions with independent, private valuations.  The challenge is that collusion may be difficult to detect  because colluders can use a simple and costless strategy to  make their bids appear competitive. If the econometrician  observes an exogenous shifter of the level of competition  in the auction in addition to the winning bids, a  statistical test for collusion by a given bidder can be  formulated as a test of independence between the exogenous  shifter and the valuations that rationalize its bids under  the null hypothesis that it is not colluding. Simulations  confirm this test performs well even when colluders attempt  to disguise their behavior. I then adopt a multiple  hypothesis testing framework to simultaneously test for  collusion bidder by bidder. By controlling the probability  of making one or more type I errors, the set of rejected  hypotheses serves as a lower confidence bound on the set of  colluders. To produce a lower confidence bound on the cost  of collusion, I use consistent estimates of the bidders'  valuation distributions to numerically solve for the  seller's expected revenues in auctions with and without  collusion. To provide an example of this identification  strategy, I use exogenous variation in the reserve prices  at British Columbia's timber auctions to estimate the  extent of collusion in the years preceding a lumber trade  dispute between the United States and Canada.},
      url = {http://knowledge.uchicago.edu/record/1337},
      doi = {https://doi.org/10.6082/uchicago.1337},
}